India's Central Bank May Be Giving up on a 'Crypto-Rupee', Report Claims

The Reserve Bank of India (RBI), India’s central bank, has reportedly shelved plans to launch a central bank digital currency (CBDC) for now, as it “doesn’t want the digital currency” anymore, believes it’s “too early to even think about a digital currency.”

According to local news outlet The Hindu Business, unnamed sources have revealed India’s central bank is no longer looking to launch its own CBDC, but may instead be looking at what other developed countries do, as it doesn’t “have a formal unit for tracking of, and policy-formation on” cryptocurrencies and blockchain technology.

The news outlet’s source was quoted as saying:

The government doesn’t want the digital currency any more. It thinks it is too early to even think about a digital currency.

The RBI initially revealed it was looking into the possibility of launching a cryptocurrency in April of 2018, when it established a group to look into its potential advantages. Reportedly, its idea would be to better control money laundering and cybersecurity threats, among others, through its CBDC.

As CryptoGlobe covered, in October a private panel with India’s finance ministry revealed high ranking officials were considering a national cryptocurrency, although not every official agreed such a token would be a step forward for the country.

Per The Hindu Business the founder of crypto exchange Belfrics, Praveen Kumar, noted that it’s too early for the RBI to “launch [a] crypto-rupee” as more understanding of the cryptocurrency economy is required. Waiting to see how it evolves, he said, is the “right decision.”

Kunal Nadwani, the CEO of uTrade Solutions, claimed government throughout the world will “launch fiat cryptocurrencies, whether out of compulsion or choice,” adding that the ability to tax their citizens in whichever token they choose lets them create fiat-currency based cryptos. Per his words, however, “it will take time before central banks are able to make this transition.”

Notably, local media have also recently reported that an interdisciplinary committee set up by the Indian government is looking into regulating and legalizing cryptocurrencies in the country, although with tough terms and conditions.

Last year, India’s RBI notably used a circular that ordered commercial banks to stop dealing with cryptocurrency-related firms. The move, as CryptoGlobe covered, saw one of India’s largest exchanges by trading volume, Zebpay, shut down.

At the time the crypto community fought back, and saw a missive from the country’s supreme court uphold the RBI’s decision. In late October, the supreme court even asked the government to clarify its stance on cryptocurrencies.

Ripple Files Motion to Dismiss Lawsuit, Says XRP is Not a Security

  • Ripple has filed a motion to dismiss a lawsuit brought by a group of XRP investors.
  • San Francisco-based startup argues that XRP is not a security.

San Francisco-based startup Ripple has filed a motion to dismiss a pending lawsuit brought against them by a group of XRP investors, arguing that the cryptoasset is not a security. 

XRP Not a Security

According to the filing published on Sept. 19, Ripple denies that XRP is a security because “it is not an investment contract.”

The filing continues, 

Purchasing XRP is not an “investment” in Ripple; there is no common enterprise between Ripple and XRP purchasers; there was no promise that Ripple would help generate profits for XRP holders, and the XRP Ledger is decentralized.

Unlike purchasing traditional securities, such as stocks, Ripple is arguing that it has no obligation to XRP investors despite its close association with the crypto-asset. Ripple further reiterated that XRP is a currency, and should not be considered an unregistered security by regulators and lawmakers. 

In addition to arguing against XRP being a security, Ripple said the statute for the lawsuit has passed and pointed out that the company did sell XRP directly to the plaintiffs, 

Countless other XRP holders in addition to Defendants (including Plaintiff, see id.) sell XRP on exchanges, making it impossible to plausibly conclude that Plaintiff purchased an initial distribution of XRP from Defendants.

The filing stems from a lawsuit brought against Ripple in May 2018 by a group of XRP investors, who claimed the company violated state and federal securities laws. The complaint was amended in August, with the group now arguing that XRP is an unregistered security under the US Securities & Exchange Commission’s (SEC) guidelines. 

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