Former RBI governor Raghuram Rajan mentioned on Wednesday that solely a “handful” of the 6,000 cryptocurrencies that exist at the moment might survive going ahead.
Comparing the cryptocurrency craze within the seventeenth century with the tulip craze within the Netherlands, Rajan mentioned that folks maintain cryptocurrency for 2 causes – to retailer worth and an asset that may recognize; and to be used in funds.
“Do we really need 6,000 cryptocurrencies to make payments? There will be one or two, maybe a handful, that will survive to be used for payments, even if the technology is so useful that it is an alternative to cash and currency.” …
“This shows that most cryptocurrencies with high values are unlikely to survive in the times to come,” Rajan informed CNBC-TV18.
The remarks come a day after the federal government listed to be tabled in Parliament to ban all personal cryptocurrencies, with few exceptions.
“The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021” to be launched within the Winter Session of Parliament beginning November 29, “To create a facilitating framework for the creation of an official digital foreign money to be issued by the Reserve Bank of India ” Wants. ,
The invoice additionally seeks to ban all personal cryptocurrencies in India, nonetheless, it permits sure exceptions to advertise the cryptocurrency and the expertise underlying its use.
Rajan additional added that cryptos could cause an issue just like unregulated chit funds that take cash from folks and get shut down.
“If things have value only because they will have more value down the line, if that’s the only reason, we call it a bubble,” Rajan mentioned.
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With inputs from TheIndianEXPRESS
