Nilekani's stance is significant, as he is one of India's most prominent technocrats and has played a central role in building India's digital rails- be it Aadhaar, the UPI payment infrastructure, GST or FASTag.
“We should think of crypto as an asset class and allow people to have some crypto. Crypto as a transaction medium will not work as fast as UPI, which is targeting a billion transactions a day. But crypto has enormous capital,” Nilekani said during a conversation with angel investor Balaji Srinivasan and Karthik Reddy of Blume Ventures, at a Clubhouse session organised by the Indian VC fund.
Nilekani, who continues to advise several government agencies and the Reserve Bank of India, which favours a ban on cryptocurrency, said there is no doubt that Indians have embraced blockchain.
“Indian regulators are also considering a Central Bank Digital Currency or CBDC. I am not sure we need a private stable coin or if a digital rupee will be good enough. We need to look at how it will help Indians, how MSMEs can access capital using Bitcoins. No amount of tech is going to sway anyone's view," he said.
Nilekani was in conversation with angel investor Balaji Srinivasan and Karthik Reddy of Blume Ventures, at a Clubhouse session organised by the Indian VC fund.
At the same time, Balaji, who said in a recent post that India should champion decentralized cryptocurrencies like Bitcoin and Ethereum to safeguard national security, prevent deplatforming and hasten India's development as a global power, said the way crypto plays out is going to be different in India.
He added that he is working on a crypto stack with think tank iSpirt, which will be made public soon, adding that while a digital rupee running domestically on UPI is welcome, it should also facilitate international transactions.
There are 75 lakh people in India who invest in cryptocurrencies and there are 350 startups operate in blockchain and crypto. Indian also hold billions of dollars in Bitcoins in their portfolio, with crypto exchanges estimating that Rs 10K-Rs15K crore worth crypto is held by Indians today.
Finance Minister Nirmala Sitharaman recently said the government is still deciding on its opinion on cryptocurrency and will take a calibrated position, stoking hopes that the Government will not impose a complete ban. "We also want to make sure that there is a window available for all kinds of experiments in the crypto world," she told CNBC TV18.