India’s central bank Reserve Bank of India (RBI) has set up a new unit to supervise, oversee its efforts in emerging technologies including cryptocurrency, blockchain and Artificial Intelligence (AI).
Although RBI has put a ban on cryptocurrencies in April, the new unit will research and possibly draft rules and supervise new emerging technologies in the future including cryptocurrencies and its underlying technology, Blockchain, reported Economic Times today.
However, there’s no official announcement from the central bank bu the new unit is reportedly a month old and a chief general manager has been appointed to lead it.
The idea behind forming this new unit, exclusively for emerging technologies, is to use data, analytics and real time information for different RBI functions like inflation targeting, banking regulations and policy enforcement. This unit on data sciences is likely to start in December 2018.
“As a regulator, the RBI also has to explore new emerging areas to check what can be adopted and what cannot. A central bank has to be on top to create regulations. This new unit is on an experimental basis and will evolve as time passes,” said the report citing a person familiar with the RBI’s plans.
The efforts come as the Indian government announced its plans to explore blockchain technology earlier this year. While presenting Union Budget 2018-19, Indian Finance Minister Arun Jaitley had said, “The Government will explore use of block chain technology proactively for ushering in digital economy.”
Last September, A.S. Ramasastri, Director of the RBI’s research arm, the Institute for Development and Research in Banking Technology (IDRBT), said that the institute was developing a blockchain-based platform for handling different banking-related applications.
Moreover, despite the ban, RBI isn’t giving up on the idea of a cryptocurrency completely. In line with central banks around the globe, the RBI too is mulling introducing a fiat digital currency called ‘Lakshmi’ coin, which would become an alternative to the Indian rupee for digital transactions, and unlike bitcoin which is a non-fiat digital currency, the new one will be fiat-cryptocurrency.
It may also be recalled that a blockchain startup of Indonesian-origin called Pundi X announced that it is preparing to launch point-of-sale network in India so that people in the country can buy and invest in cryptocurrencies not just only online but offline as well.
[Top Image – Moneylife.in]