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Nandan Nilekani believes crypto has stored value, just like gold or silver, but has no transaction value. Unlike Musk, however, Nilekani has a balanced approach to cryptocurrency that includes the coexistence of UPI. The Indian government was very reluctant towards cryptocurrency at first and banned it in 2018. The Supreme Court overturned this ruling. Even crypto exchanges have asked the government to view cryptocurrencies as an asset. Often regarded as one of India’s most respected voices, Infosys co-founder Nandan Nilekani believes the country can view cryptocurrencies as an asset amid growing popularity and lack of regulatory oversight. . He believes crypto has stored value, just like gold or silver, but lacks transactional value.
“Just like you have some of your assets in gold or real estate, you can have some of your assets in crypto,” he told the Financial Times in an interview. “I think crypto has a role to play as a stored value, but certainly not in a transactional sense.”
Nilekani is often credited with starting the IT boom in India and creating an industry like no other. He is also the architect of the Aadhaar biometric identity project managed by UIDAI (Unique Identification Authority of India). As the government mulls over regulations, expert support adds a lot of confidence to new investors. A phenomenon currently mastered by Tesla co-founder Elon Musk. Unlike Musk, however, Nilekani has a balanced approach to cryptocurrency that includes the coexistence of UPI (Unified Payments Interface). He believes that the local payment solution is much more efficient because it is not volatile and requires a minimum of energy. UPI is a protocol developed by NPCI (National Payments Corporation of India) that enables peer-to-peer bank transfers to all banks in the country. The technology allows for real-time settlement and transfers barely take a second.
Unlike developed markets, India is one of the few countries to jump the debit or credit card revolution and directly join the trend of mobile payments through affordable phones and inexpensive internet connectivity. The system is already designed to handle a billion transactions every day, eliminating the need for cryptocurrencies for payments.
At the same time, Nilekani is convinced that cryptos can be a solid asset in the years to come. Blockchain as a technology has grown tremendously and Indian IT companies are at the forefront, serving hundreds of multinational clients.
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“Indian regulators are also considering a central bank digital currency or CBDC. I don’t know if we need a stable private coin or if a digital rupee will be good enough. MSMEs can access capital using Bitcoins. No amount of technology is going to influence anyone’s point of view, “he added. With a market capitalization of over $ 1.5 trillion, crypto can allow the community to pour its wealth into the Indian economy.
The Indian government was very reluctant towards the cryptocurrency at first and banned it in 2018. A Supreme Court ruling quickly overturned the ban, but investors remain concerned. Indeed, some Indian banks remain cautious, despite RBI’s clarifications on its 2018 circular.
Even crypto exchanges have asked the government to view cryptocurrencies as an asset. And while they wait for regulation, Indian crypto players have decided to form a self-regulatory council under the umbrella of industry body IAMAI and have set minimum guidelines to fight fraud.
The world of cryptocurrency is unusually polarized and everyone has a different point of view. Evangelists call it a revolution, technocrats believe in the potential of blockchain, opponents believe it’s a bubble, while some just watch the circus do its job. Smart and sensible cryptocurrency regulations are the need of the moment.
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