Digital Rupee will be guaranteed but not Crypto

By Narvijay Yadav 

India is about to launch its own Digital Rupee. Meanwhile, a few important instructions have been announced regarding the Crypto advertising. It has become mandatory to clearly write the warning on the advertisements of Crypto, as is written about smoking on the cigarette packs. The Advertising Standards Council of India (ASCI), a regulatory body that monitors the quality of advertisements in the country, has issued new guidelines regarding Crypto related ads, which will come into effect from April 1, 2022. According to the new guidelines, it will be mandatory to write in any Crypto related advertisement that there is no regulation on Crypto in the country and investing money can be highly risky. The investor himself shall be liable for any loss arising out of such transactions. These warnings have to be prominently displayed in the advertisements so that everyone can see them without a fail. Also, Crypto cannot be called a ‘currency’ in the advertisements. The logic behind this is that because people trust words like ‘currency’ and ‘securities’, therefore investors can be misled. The inclusion of children in these advertisements is also prohibited. 

Crypto ads will also include the advertiser's name, phone number or email address, so that they can be contacted if needed. Celebrities who appear in Crypto ads are also advised not to make misleading claims and only get involved in any such advertisement after understanding everything thoroughly. Actually, digital transactions are a completely new thing in our country, which will take a lot of time for people to understand it properly. In such a situation, along with the government, it is also the responsibility of banks, news media and experts related to financial matters to make the general public aware and keep warning about any kind of financial risks. Considering Crypto a virtual digital asset, the central government has imposed a 30% tax on its transactions, but this does not mean that it has got government approval. Crypto in India is neither recognized by the government, nor is there any government agency to regulate it. In such a situation, if there is any fraud or loss, then it will be entirely the responsibility of the person investing money in Crypto. 

The Reserve Bank of India (RBI) is preparing to introduce a Digital Rupee, which will be like a bank note, but it will not require any ATM. RBI will take guarantee of this Digital Rupee. Since the central bank will have a direct role in this, there will be no risk of any loss to the people, as has been done in the case of commercial banks earlier. People will be able to transact it in the form of an online token through a smartphone wallet from their savings account. Over the years, customers of 21 banks, involved in malpractices, were barred from withdrawing their own money. However, the digital rupee also has a flip side. Imagine if the digital rupee becomes more popular then banks will find it difficult to maintain small savings accounts, because most of the people can switch to electronic cash. Finance experts believe that there is no need for a digital rupee in India right now, as there is enough cash in the country.

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Narvijay Yadav is a senior journalist and columnist.

Email: narvijayindia@gmail.com