• Sat. May 21st, 2022

Nirmala Sitharaman: IMF steps up work on digital currency as FM signals terror and threat of money laundering | India Business News

ByHazel R. Lang

Apr 19, 2022
NEW DELHI: The International Monetary Fund on Tuesday pledged to expand its work on crypto assets, amid a call from Finance Minister Nirmala Sitharaman to build a consensus to deal with digital assets.
During a panel discussion early on Tuesday morning (India time), Sitharaman shared his concerns over the possible misuse of private digital currencies for money laundering and terrorist financing and reiterated the government position that one country cannot regulate the use of this rapidly growing instrument. Furthermore, she said that the technology to manage crypto assets needs to evolve constantly.
“Regulation using technology is the only answer. Regulation using technology will have to be so adept that they are not behind the curve, but make sure they are above it. And that’s not possible if a country thinks it can handle it. This must be generalized, ”said the FM.
Indian authorities are working on crypto asset legislation but are unsure whether a full-fledged ban, as advocated by a panel of experts as well as the Reserve Bank of India (RBI), will work unless others countries are also on board. For the time being, the government has imposed a tax on crypto transactions, including a 1% withholding tax, which Sitharaman said was key to establishing a money trail.
She also said that the evolution of technology and programs – from Aadhaar to Jan Dhan – prompted her to announce central bank digital currency (CBDC) in the budget, which is expected to be rolled out by RBI over the course of the year. of the current fiscal year.
While acknowledging some of the concerns, IMF Managing Director Kristalina Georgieva said the multilateral agency will expand its work on digital currency with a focus on CBDC interoperability, regulation of private digital currencies and the risks of cyberattacks. While bullish about the CBDC, the IMF chief seemed concerned that private digital currencies pose a threat to the monetary sovereignty of smaller economies.
His comments came amid support from the central banks of Singapore and Brazil on the CBDC making international transfers smoother and easier for individuals, even the chief executive of the Monetary Authority of Singapore, Ravi Menon, said that did not see a “compelling case” for retail digital currencies launched by central banks. .

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