India · Federal Reserve (FED) · Cointelegraph
India's central bank revives push to isolate banks from crypto: Report
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The Indian central bank reportedly urged lawmakers to keep banks insulated from crypto and private stablecoins while preserving room for regulated tokenization.
Key facts
- India’s Supreme Court overturned the circular in March 2020, following a challenge brought by exchanges and the Internet Mobile Association of India
- According to a report by The Economic Times, RBI Deputy Governor Rohit Jain and Executive Director P
- India ranked first in Chainalysis’ 2025 Global Crypto Adoption Index, although the RBI reportedly challenged the methodology behind private-sector adoption rankings
- In May 2021, the RBI clarified that banks could no longer cite the invalidated circular when cautioning customers against crypto transactions
Summary
The Reserve Bank of India (RBI) reportedly backed a containment strategy for digital assets to shield banks and other financial institutions from exposure to crypto and privately issued stablecoins, as lawmakers prepare a report on the country’s digital asset policy. According to a report by The Economic Times, RBI Deputy Governor Rohit Jain and Executive Director P. In a background note submitted to the panel, the RBI reportedly said prohibition remained a recognized policy option and recommended preventing the use of crypto in payments and settlements while restricting banking-sector exposure. The central bank reportedly warned that applying traditional regulation to crypto could legitimize speculative assets and create a false perception of safety among users.