RBI: Bitcoin has value and is eliminating currency

News | March 6, 2017 By:

The Deputy Governor of the Reserve Bank of India (RBI), R. Gandhi, gave a keynote address last week at a fintech conference stating that bitcoin has value and is eliminating currency.

The Deputy Governor opened the event with a 20-minute inaugural address. He discussed fintech, crowdfunding, blockchain technology and Bitcoin, with the general subject of digital currency taking up the latter half of his speech.

“Bitcoin have acquired value. They are being used for settling varieties of economic transactions. People are using them as investment also. And a store of value. So currency is being eliminated,” said Gandhi.

However, he also gave several reasons why digital currencies that are not backed by the government will fail to achieve mass adoption.

“My arguments against these virtual currencies stem from two key elements, they are the concept of confidence and anonymity. The currency should be able to sustain these two elements forever. It will impair its exalted status once either of these elements gets affected,” said Gandhi.

Despite admitting that bitcoin has eliminated some amount of currency, the central bank governor said: “It may remain a pipe dream that blockchain will eliminate currency by ushering in virtual currency. It is unlikely.”