Crypto assets can negatively impact financial stability, says RBI report
The Reserve Bank of India (RBI) has raised concerns about the potential risks posed by cryptocurrencies and stablecoins to macroeconomic and financial stability. In its recent Financial Stability Report, the RBI highlighted that widespread adoption of these digital assets could undermine monetary policy effectiveness, exacerbate fiscal risks, and threaten global financial stability. The central bank emphasized that, despite the current modest size of crypto markets, their rapid growth and increasing integration with traditional financial systems could pose systemic risks. The RBI's stance aligns with global regulatory bodies, such as the Financial Stability Board, which have also expressed concerns about the implications of crypto-assets and stablecoins on financial stability. As the crypto ecosystem continues to evolve, the RBI underscores the need for robust regulatory frameworks to mitigate potential threats to economic stability.