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Indian leader compares threat of cryptocurrencies to inflation and climate change

India’s Prime Minister Narendra Modi said all nations should unite in tackling the threats posed by cryptocurrencies, speaking virtually at the 2022 World Economic Forum’s annual conference in Davos, Switzerland.

"Cryptocurrency is an example of the kind of challenges we are facing as a global family with a changing global order. To fight this, every nation, every global agency needs to have collective and synchronized action," Modi said in his address.

Modi compared crypto to major economic challenges like supply-chain disruptions, inflation, and climate change, stressing that none of them can be dealt with properly by one country at a time.

"The kind of technology cryptocurrency is associated with makes decisions taken by one country inadequate to meet the challenges posed by cryptocurrency. We have to have common thinking," Modi urged. India’s leader also noted that in order to deal with crypto, multinational economic organizations and institutions tasked with regulating the economy need to evolve.

"When these institutions were formed circumstances were different and today they are different. That’s why every democratic nation has the responsibility to bring about an emphasis toward reforms in these institutions to make them capable enough to deal with modern challenges in the future," he stressed.

India does not yet have a clear regulatory framework for cryptocurrencies, but authorities in New Delhi have been busy working on a draft bill for the cause. The bill has reportedly evolved from initially banning all private cryptocurrencies and creating a national digital coin instead, to allowing crypto to be used as an asset, but banning its use as legal currency or payment.

It is not the first time Modi has warned the global community of the potential threats posed by crypto. In November last year, the Indian leader brought up digital currencies as an example of how it was important for democratic countries to "work together" to "ensure [crypto] does not end up in the wrong hands, which can spoil our youth."