- HDFC’s chief economist feels that cryptocurrency regulation in India will be favorable to investors.
- The report reiterated the plans of a central bank digital currency launch.
- The RBI has recently been pulling strings on the country’s banks to stop servicing crypto businesses.
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Major Indian bank HDFC has published a report on cryptocurrencies, weighing the pros and cons they could bring to India. The report comes after the country’s central bank introduced new roadblocks for the industry.
HDFC Reports on Cryptocurrencies
HDFC, one of India’s top three banks, has published a report on crypto assets.
“We think it’s a matter of time before Indian investors have legal access to crypto plays,” wrote HDFC’s chief economist Abheek Barua in a paper titled, “Cryptocurrencies: Fad or Forever?” The report came as a positive piece of news for investors fearing a ban.
Excerpts of the report were shared on social media today. The report noted the increasing correlation between Bitcoin’s price movement and gold. “Though the correlation was weak to start with, it has been rising,” it read.
The report also noted that India plans to launch a central bank digital currency.
Barua expressed optimism in the long-term survival of the space by judging the rise in the number of non-zero addresses. “Tokens are here to stay and are not going away in a hurry,” he added.
However, the report also raised concerns around the increasing euphoria seen in the rise of Google searches.
The conclusion was that crypto has the “properties of being a good hedge” for portfolio diversification, showing resistance to macroeconomic shock, and has a limited supply like gold.
Central Bank Imposes Banking Hurdles
The country’s central bank, however, has reportedly asked banks to restrict services to crypto businesses. Many Indian cryptocurrency exchanges are struggling to keep up their payment channels as banks sever ties with…