‘Avoid Crypto’ Directive Marks India’s fintech priorities

At the world’s largest fintech gathering in Mumbai this week, more than 100,000 participants and 800 speakers convened to explore the future of digital finance yet one topic was conspicuously absent: cryptocurrency. The three-day conference, held from October 7, was headlined by the prime ministers of India and the United Kingdom and brought together regulators, investors, and fintech leaders from over 100 countries.

Despite Bitcoin’s surge past $125,000, cryptocurrencies and stablecoins found no place in official discussions. Organisers the Payments Council of India, National Payments Corporation of India (NPCI), and Fintech Convergence Council explicitly instructed speakers to “avoid political, crypto, religious, or personal remarks” on stage or at the venue, according to event guidelines circulated to participants. The advisory underscored India’s regulatory caution toward digital assets and the government’s preference to steer dialogue toward officially backed digital innovations like the central bank digital currency (CBDC), or the e-rupee.

The instruction to steer clear of crypto discussions reflects India’s ongoing regulatory restraint. While countries such as Japan, Hong Kong, and Singapore are actively positioning themselves as regional crypto and stablecoin hubs, India’s stance remains defensive. The Reserve Bank of India (RBI) continues to voice concerns over potential risks including money laundering, consumer protection, and financial instability that could arise from unregulated crypto adoption.

Instead, India used the platform to highlight advancements in its sovereign digital initiatives. The RBI showcased pilots on deposit tokenisation and launched a sandbox for fintech innovation. The e-rupee was a centerpiece of these discussions, reflecting the government’s broader preference for tightly controlled, traceable digital financial systems.

The absence of crypto discourse did not go unnoticed. Multiple industry executives acknowledged that the lack of regulatory clarity has stifled innovation and discouraged potential entrants. Mandar Kagade, founder of Black Dot Public Policy Advisors, noted that “policy ambivalence has a chilling effect” on developing commercial use cases for stablecoins in India.

Similarly, Sahil Kini, CEO of the Reserve Bank Innovation Hub, defended the cautious stance, emphasizing that such regulatory positions do not shift “overnight.” Venture investors like Joseph Sebastian of Blume Ventures argued for a more iterative approach, suggesting that stablecoins could be safely piloted for inward remittances, a critical use case for India’s $100-billion annual cross-border transfer market.

The reluctance to engage with crypto has broader market implications. While fintech investment in India stood at $3.5 billion in 2024 the lowest since 2020 some analysts believe regulatory clarity on crypto could reignite investor confidence. Conversely, startups seeking to build in the blockchain and digital asset space are increasingly incorporating abroad, leading to what some term a “brain drain” of technical and entrepreneurial talent.

Over 50 new fintech products were unveiled at the event, including PayPal’s global wallet, Revolut’s India launch, and biometric payment tools linked to India’s Unified Payments Interface (UPI). These innovations underscore the nation’s commitment to advancing payments infrastructure and fintech inclusion, even as it sidesteps the volatile crypto domain.

Looking forward, industry observers expect the Indian government to continue prioritizing regulated digital finance, expanding CBDC pilots, fostering open banking frameworks, and deepening UPI integrations while maintaining its measured distance from private cryptocurrencies. However, global momentum around stablecoins and tokenised finance may eventually compel India to revisit its stance.

In the short term, payment service providers, digital banking platforms, and e-rupee-linked fintechs stand to gain from regulatory alignment and institutional support. Conversely, crypto exchanges, blockchain startups, and venture funds exploring token-based business models continue to face barriers to domestic growth.

While India’s caution offers stability, it may also cost the country a first-mover advantage in the global digital asset economy. As one industry consultant observed, “It’s becoming real whether we like it or not the question is how India chooses to engage with it.”