A top official at India's central bank reiterated concerns about cryptocurrency trading, comparing the virtual coins to Ponzi schemes, in a strong warning to Prime Minister Narendra Modi's government.
T. Rabi Sankar, Deputy Governor of the Reserve Bank of India, has called for a ban on cryptocurrencies, claiming that they threaten a country's "financial sovereignty" and "undermine financial integrity" because there are no underlying cash flows.
"We have also seen that cryptocurrencies are not amenable to definition as a currency, asset, or commodity; they have no underlying cash flows, no intrinsic value; that they are akin to, and possibly worse than, Ponzi schemes," Sankar said in a speech at a banking conference on Monday.
So far, there is no regulation of cryptocurrency trading in India. The Supreme Court overturned the RBI's ban in March 2020, and since then, crypto investments have exploded in the country. According to an October report from Chainalysis, a crypto-analysis firm, the Indian market grew 641% between July 2020 and June 2021.