India’s RBI Intends to Push G-20 to Focus on Crypto’s Macro Risks

The Reserve Bank of India (RBI) is trying to expand the global narrative around cryptocurrencies beyond “financial stability and integrity to macro-financial and cross-sectoral implications and risks of crypto-assets,” the central bank said in its annual report published on Tuesday.

The move is seen as a step to attract attention towards how crypto can hurt or completely change the global economy rather than just nations and customers individually, government sources have told CoinDesk previously. However, this is perhaps the first time the RBI has articulated its “intent” as an important stakeholder in the current global conversation around global crypto rules, even as it reiterated its concerns saying “cryptocurrencies are a material threat to financial stability.”

India currently holds the presidency of the Group of 20 (G-20) nations, giving it the power to set the agenda. The RBI helps the Finance Ministry in shaping the agenda.

At the start of the nation’s presidency, Indian Finance Minister Nirmala Sitharaman said how to regulate crypto assets should be an international priority and will be a big topic of discussion during its G-20 presidency.

In February, India announced that coming global crypto rules will be based on what’s in a new synthesis paper jointly produced by the International Monetary Fund (IMF) and the Financial Stability Board (FSB). The FSB sets international standards around global financial stability and is expected to publish its individual recommendations for regulating crypto and stablecoins in July 2023.

“The intent of India’s Presidency is to expand the G-20 crypto asset narrative beyond financial stability and financial integrity concerns to capture the macro-financial and cross-sectoral implications and risks of crypto assets,” the RBI annual report said. The report also revealed the central bank is prioritizing the discussion on CBDCs “with a focus on their macro-financial implications.”

India’s ongoing retail and wholesale CBDC pilots will be expanded by “incorporating various use cases and features” to more than the current 15 cities and 13 banks, the report said. The retail CBDC pilot began in Dec. 2022 and by April it had onboarded more than 100,000 customers, with the ambition to take that number to a million by July, CoinDesk has reported.