You can buy gold, diamond, crypto, but that will have not have the value authorization by government,” said T.V. Somanathan.
Somanathan, the Indian government’s finance secretary, reportedly dismissed the narrative that cryptocurrencies would be widely accepted in the country, dismissing the possibility of using them as legal tender.
According to a tweet on Wednesday from Asian News International, Somanathan said a digital rupee backed by the Reserve Bank of India, or RBI, would be accepted as legal tender, but major cryptocurrencies have no way of doing so. The finance secretary added that because digital assets including Bitcoin (BTC) and Ether (ETH) lack government clearance, they will likely remain “assets whose value will be determined between two people.” “The digital rupee issued by RBI will be legal tender
Somanathan said. “The rest is not legal tender, it will not, it will never be legal tender. Bitcoin, Ethereum or NFT will never be legal tender […] You can buy gold, diamonds, cryptocurrencies, but it will not have the authorization of the value by the government.
The finance secretary added:
“People investing in private crypto should understand that it does not have the authorization of government. There is no guarantee whether your investment will be successful or not, one may suffer losses and government is not responsible for this.”
Somanathan’s words followed Indian finance minister Nirmala Sitharaman announcement on Feb. 1 that the country planned to launch a central bank digital currency, or CBDC, by 2023, adding it could provide a “big boost” to the digital economy. She also proposed that transactions on digital assets be taxed at a rate of 30%.