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Deputy Governor of the Reserve Bank of India, Shri R. Gandhi pointed out the pros and cons of digital currency and crowdfunding platforms at the FIBAC banking conference in Mumbai on 25 August, 2015.

During his speech dedicated to disruptive innovations and financial inclusion in the banking area, Gandhi pointed out that cryptocurrency and crowdfunding had the potential to be beneficial as well as carry some risks. 

He admitted the innovative nature of digital currency and its potential implications for financial inclusion and growth, while stated that “crypto currency can support activities which do find difficulties in settling such transactions in the normal ways”.

However, digital currency bitcoin and crowdfunding exist in regulation free financial system, so with no enforcement on international scale they are likely to be used for criminal activity:

“Both have the potential to support criminal, anti-social activities like money laundering, terrorist funding and tax evasion. While we do not have any reported instances of crowdfunding in this respect, crypto currencies have been widely suspected to finance criminal activities. We have to be carefully and critically watching these developments.”

Last week, the governor of RBI Raghuram Rajan stated that India’s central banking institution was watching the development of cryptocurrency closely choosing not to intervene. He also stressed the need of active “market intelligence” in order to monitor cryptocurrency’s usage.

 

Daria Petushkova