Nandan Nilekani, chairman of software services exporter Infosys, said at the Reuters Next Conference on Wednesday that cryptocurrencies are worth considering and can be used to bring more financial inclusion.
Nilekani, who co-founded Infosys, India's No, said that there is a role for cryptocurrencies as assets but they have to be followed by all the laws and make sure that it doesn't become a backdoor for money laundering. Nilekani, a well-networked technocrat who has played a key role in creating India's 1.3 billion-strong biometric database, said that it is not suitable for transactions because of its high transaction costs and volatility.
Nilekani's comments come at a time when India's federal government is planning to discourage trading in cryptocurrencies by imposing huge capital gains and is looking to classifycryptocurrencies as an asset class, Reuters reported last month.
New Delhi has said it will allow only certain cryptocurrencies to promote the underlying technology and its uses.
If we have a good regulated and legal, lawful market for cryptocurrencies, not as currency but as assets, and a lot of young people build innovative applications around that, then these young people could create a wave of global companies, Nilekani said.
India has 15 million to 20 million investors in the world, with total holdings of around 400 billion Indian rupees US $5.35 billion. In his first public comments on the subject, India's prime minister Narendra Modi said in November that all of the democratic nations must work together to make sure thatcryptocurrencies don't end up in wrong hands, which could spoil our youth India's central bank's digital currency.