On Thursday, India said that, as G20 president, it will work toward creating a worldwide regulatory framework for unbacked crypto assets, stablecoins, and decentralised finance, and might even look at “prohibition,” which would be a major setback for the sector as it is still in its infancy.

The Reserve Bank of India, India’s central bank, recently made statements contradicting the industry’s narrative and claims that virtual digital assets may be used as a hedge against inflation by being very volatile and exhibiting significant correlations with stocks.

The Reserve Bank of India issued a warning echoing the sentiments of other central banks across the world, saying that crypto might “divert funding away from conventional finance with larger impact on the actual economy” if it becomes increasingly integrated into the mainstream financial system.

Early this month, India assumed the leadership of the Group of 20 for a full year. Collectively, the 19 countries that make up the G19 plus the European Union account for 85% of global GDP. It also welcomes participation from nations outside the EU, such as Singapore and Spain, as well as international agencies like the World Bank and the International Monetary Fund.