RBI Denies ‘Formal Creation’ of Blockchain Unit

By Ravindra Chagetha

The regulatory authorities all over the world are trying to find a better solution to provide the new revolutionary technology in a proper direction. In an attempt to have a defined approach, officials all over the world have shown mixed sentiments towards the blockchain industry. The government of India is still unclear with the future of blockchain technology as the decision to grow the blockchain industry keeps on swinging. In the recent news, the central bank RBI has denied the “formal creation” of a unit to research AI and blockchain technology.

The central bank was, a week before, rumoured to have set up a unit that would specifically focus on “research and possibly draft rules” for the revolutionary technology. This gave hint back then that the government is having a positive attitude towards the growth of blockchain technology. In regard to this, the Economic Times also mentioned the anonymous sources who were “familiar with the central bank’s plans”.

The rumours were getting into nerves and the founder of Coin Crunch India which is a cryptocurrency news website, Naimish Sanghvi, filed a Right To Information (RTI) seeking confirmation about the plans of the central bank, as the rumours suggested, and the head of the unit for this operation. On September 26th Sanghavi received an acknowledgement denying the claimed effort.

The RBI said:

“There is no new unit created formally in RBI for the purpose (Blockchain, Crypto and AI) mentioned in RTI query”.

RBI’s stance on crypto use does not seem to deviate even if it has formed a unit to “study and provide guidance on the desirability and feasibility to introduce a central bank digital currency.”

In April RBI issued circular ordering banks to halt services to cryptocurrency business, this decision by the officials took aback the crypto industrialists and even caused exchange businesses to cease trading. This eventually led to trade in crypto-to-crypto and consequently, the trading volume suffered.

The ban was not entertained and several exchanges filed the counter petitions with the Supreme Court (SC) and the combined cases were postponed.