Reserve Bank Deputy Governor T Rabi Sankar has made a strong argument for cryptocurrency prohibition, claiming that they are far worse than Ponzi schemes and pose a threat to a country's financial sovereignty. Given that cryptotechnology is based on a mindset of evading government regulations, Sankar says that they were created intentionally to circumvent the regulated financial system.

More significantly cryptocurrencies can wreck the currency system, monetary authority, banking system, and in general the government's ability to control the economy, he added,. "All these factors lead to the conclusion that banning cryptocurrency is perhaps the most advisable option open to India," Sankar said while delivering a keynote address at the Indian Banks Association seventeenth  Annual Banking Technology Conference and Awards.

The Deputy Governor said crypto-technology is underpinned by a philosophy to evade government controls. "Cryptocurrencies have specifically been developed to bypass the regulated financial system. These should be reason sufficient to treat them with caution. "We have also seen that cryptocurrencies are not amenable to definition as a currency, asset or commodity; they have no underlying cash flows, they have no intrinsic value; that they are akin to Ponzi schemes, and may even be worse. These should be reason enough to keep them away from the formal financial system," he noted.

Cryptocurrency Taxation ‘sovereign right’: decision to Ban or not ban later: FM

Shaktikanta Das sees Pvt crypto as a major danger to macroeconomic, financial stability

Cryptocurrencies Watch: Bitcoin, Ethereum fall, Tether rises marginally