India joins in on the bandwagon of sovereign governments potentially creating their own cryptocurrencies
Since cryptocurrencies are pretty much in the infant stages of acceptability and understanding, sovereign governments as a whole are on the fence in how to deal with de-centralized money. ¬†However within the BRICS nations there is a growing trend towards co-opting the blockchain platform for their own benefit, and this is leading a majority of the countries within this coalition to begin a serious study on whether to create their own sovereign cryptos for both inter-bank settlement, and legal tender.
And the newest of the BRICS nations to jump on this bandwagon is that of India.
On Saturday, the¬†Business Standard¬†reported that while working on creating a legal framework for bitcoin and other digital currencies,¬†the Indian government is considering launching its own bitcoin-like cryptocurrency.
Preempting a report by the¬†BIS released on Sunday, and which recommended that central banks should seriously consider launching cryptocurrencies of their own, the Indian press reports that the Indian government is considering ‚Äúa proposal to introduce its cryptocurrency similar to bitcoin,‚ÄĚ and which will be issued by the Reserve Bank of India (RBI). This state-run cryptocurrency will be called ‚ÄúLakshmi,‚ÄĚ the name of the Hindu goddess of wealth, fortune, and prosperity.
The proposal was reportedly “discussed by a committee of government officials, and the panel found the idea of setting up and running blockchain for financial services useful.”
The report comes just days after RBI Executive Director Sudarshan Sen talked about the central bank‚Äôs discomfort with Bitcoin at the India Fintech Day conference. He hinted at the time that the government may be introducing its own fiat cryptocurrency which will be issued by the RBI.
‚ÄúRight now, we have a group of people who are looking at fiat cryptocurrencies. Something that is an alternative to the Indian rupee, so to speak. We are looking at that closely,‚ÄĚ he said. Echoing China’s own displeasure with the soaring popularity of cryptocurrencies,¬†the RBI executive stressed that the central bank is not comfortable with non-fiat cryptocurrencies such as bitcoin. –¬†Zerohedge
Both Russia and China are in the process of taking a good hard look at the creation and implementation of sovereign cryptocurrencies, even going so far as to hire Ethereum engineers to begin work on moving industrial and financial platforms onto the blockchain. ¬†And as more and more citizens within Far Eastern economies use Bitcoin and other cryptocurrencies to bypass capital control laws, the probability of them being severely regulated or potentially outlawed becomes a very real outlook.
As an adapted version of an old axiom goes… if you can’t beat them, co-opt them. ¬†And for many governments, the threat of cryptocurrencies replacing large portions of their general economies is pushing legislators towards creating their own versions of this de-centralized money, and in the end these governments have the power of law enforcement in their pockets to ensure that theirs wins out over private currencies in the long run.
Kenneth Schortgen Jr¬†is¬†a writer for¬†The Daily Economist,¬†Secretsofthefed.com,¬†Roguemoney.net, and¬†Viral Liberty, and hosts¬†the popular¬†youtube podcast¬†on Mondays, Wednesdays and Fridays.¬†Ken can also¬†be heard Wednesday afternoons giving an weekly economic report on the¬†Angel Clark radio show.