During a recent event held in Bengaluru, Smt. Nirmala Sitharaman, the Finance Minister of India, spoke about how the country has been an early adopter of digital currency and is testing its retail and wholesale CBDC to facilitate cross-border payments. However, she stressed, the technology must be used cautiously and responsibly—and only under proper regulation.
Sitharaman highlighted the potential benefits of digital currency technology beyond just currency, and how India should take advantage of this to promote collective benefit. Still, the government or central bank must take the lead to ensure the stability and security of the digital currency market. She added that unregulated markets could cause chaos similar to the FTX incident, which caused massive spillover effects worldwide.
Key Steps India’s Taking
India is still catching up as the world continues to experience the digital revolution, and erring on the side of caution when it comes to digital currency—particularly to avoid the pitfalls of unregulated markets—is the right move. According to cryptocurrency proponents, other countries need to follow India’s example.
India plans to introduce lessons on cryptocurrency and artificial intelligence in some school curriculums at the start of the next academic year. The move aims to keep up with technological advancements and ensure that students are equipped to navigate the digital world.
Digital Currency’s Rise
The Finance Minister’s call for responsible digital currency use comes at a time when the world is witnessing a surge in digital currency adoption. The rise of cryptocurrencies and other digital assets has disrupted the traditional financial system, and policymakers worldwide are struggling to keep up.
As more countries and companies embrace digital currency, there is a growing recognition that regulation is necessary to prevent market instability and protect consumers.
Looking ahead, it’s clear that digital currency will continue to shape the payments landscape, and policymakers will need to find ways to balance innovation and regulation. India’s cautious approach to digital currency provides a useful framework for other countries to follow as they navigate the evolving digital landscape. As the world continues to embrace digital technology, responsible use and proper regulation will be key to ensuring that digital currency delivers on its promise of financial inclusion and economic growth.