RBI DG Sankar: Stablecoins risky for India; CBDCs are superior digital money.

• RBI Deputy Governor T Rabi Sankar raised concerns over stablecoins, citing risks to monetary sovereignty, financial stability, and banking systems.
• Sankar argued stablecoins lack core attributes of modern money, are private currencies, and can encourage currency substitution.
• He warned stablecoins could weaken monetary policy, complicate capital account management, and undermine bank-led credit intermediation.
• The RBI DG advocated for a cautious approach to stablecoins, promoting Central Bank Digital Currencies (CBDCs) instead.
• CBDCs offer advantages of digital tokens with sovereign backing, monetary stability, and regulatory oversight, avoiding stablecoin risks.

Why It Matters: RBI warns stablecoins threaten India's financial stability, pushing for CBDCs.