Whatever data on cryptocurrency is available is misleading: RBI Deputy Guv

"Data is not available. Whatever data is available is misleading. And making regulations in the absence of adequate information carries a high probability of us ending up with the wrong set of prescriptions," RBI deputy governor T Sankar said at a virtual conference hosted by the International Monetary Fund (IMF).

On cryptocurrency, Reserve Bank of India (RBI) Deputy Governor T Rabi Sankar said whatever data is available is misleading and called for building all related rules on a clear understanding of what digital currencies are and what they are supposed to do. He also called for a single communication across the board for effective regulation of crypto.

RBI deputy governor T Sankar called for building all related rules on a clear understanding of what cryptocurrencies are.(Mint Archives)

"Data is not available. Whatever data is available is misleading. And making regulations in the absence of adequate information carries a high probability of us ending up with the wrong set of prescriptions," T Sankar said at a virtual conference hosted by the International Monetary Fund (IMF) on Saturday. The deputy governor highlighted the need for gathering "sufficient, trustworthy, and consistent information."

On the regulation front, he called for building all related rules on a clear understanding of what cryptocurrencies are and what they are supposed to do. He also called for a single communication across the board for effective regulation of crypto.

The deputy governor also batted for the formulation of an initiative modelled after the Organisation for Economic Co-operation and Development's (OECD's) Crypto-Asset Reporting Framework. "Initiatives would enable member countries to exchange information in real-time," he said. Sankar also urged the global agencies, including the IMF, to take a leading role in helping regulate cryptos.

The RBI had said that the central bank digital currency (CBDC), or the e-rupee, will be as anonymous as the currency note and would have all the relevant laws applicable to it as the currency notes.

In an interview after the announcement of repo rates by the Monetary Policy Committee, RBI Governor Shaktikanta Das on December 7 said e-rupee transactions will not have any intermediary, unlike UPI transactions.

FTX became the latest crypto exchange to collapse last month. The crypto firm reportedly used clients' money for various risky activities. Consequently, FTX clients lost billions of dollars. Bankman-Fried, who used to rub shoulders with political leaders, asserted that he was unaware of any fraud. Before this, some of the firms which recently announced financial difficulties were Terraform Labs, Voyager Digital, Three Arrows Capital (3AC), Celsius Network and Babel Finance.