India’s RBI Warns Stablecoins Pose Financial Stability Risks, Advocates for CBDCs
India's Reserve Bank has issued a stark warning in its Financial Stability Report, asserting that stablecoins present greater risks to macroeconomic stability than their purported benefits. The central bank explicitly recommends prioritizing central bank digital currencies (CBDCs) over privately issued stablecoins to maintain monetary trust.
The RBI's caution comes as India advances its digital rupee pilot, which now boasts over 5 million users and 400,000 merchants since its December 2022 launch. While cryptocurrencies remain legal, the government's heavy taxation—30% on gains plus 1% transaction levy—effectively stifles mainstream adoption.
Global stablecoin adoption continues growing, but Indian regulators remain unconvinced. Finance Minister Nirmala Sitharaman's recent comments suggest sustained skepticism toward private digital assets, reinforcing the RBI's preference for sovereign-controlled alternatives.
