Govt May ‘Experiment’ With Stablecoins; Economic Survey 2025-26 Could Highlight Their Utility

India’s central government is closely examining the potential role of stablecoins, with officials indicating that the Economic Survey 2025-26 may “present a case” for recognising stablecoins for certain types of transactions. Although cryptocurrencies currently operate without any regulatory framework in India, the government is now exploring whether stablecoins can be tested in a controlled environment before evaluating their broader utility.

Govt Considering a Stablecoin Experiment

According to a government official, India is considering an “experiment” with stablecoins before permitting them for transactional use. The official noted that global developments make it necessary for India to build a framework for stablecoins.

“We need a framework to deal with stablecoins… first, we have to check its utility and see if the banking system is equipped to handle stablecoin transactions,” the official said.

Stablecoins are cryptocurrencies whose value is tied to a stable asset such as a fiat currency (e.g., the US dollar) or commodities. Unlike volatile cryptocurrencies such as Bitcoin or Ethereum, stablecoins attempt to maintain a constant value.

Economic Survey May Present Case for Recognition

The Economic Survey 2025-26 may highlight why stablecoins could be recognised for specific use-cases. This could potentially mark the first formal mention of stablecoin utility in an official government document.

As of now, India has no legal framework governing cryptocurrencies, and they are not recognised as legal tender. The government has prepared a discussion paper on crypto, though it has not yet been released publicly.

The paper is expected to outline:

• Potential technological advantages of cryptocurrencies

• different treatment for Bitcoin, stablecoins, and other digital assets

• The possibility of using stablecoins for global payments

• References from the US legislative developments

Also Read:Bitcoin Falls Over 30% From October High as Market Turns Risk-Off

Global Developments Being Considered

The government is also assessing international examples. The United States introduced the GENIUS Act in July to regulate dollar-backed payment stablecoin issuers, offering a clearer structure for stablecoin transactions.

India’s upcoming paper may draw cues from such global guidelines and evaluate whether stablecoins should be regulated differently from other cryptocurrencies.

Diverging Views Within the Financial Ecosystem

Stakeholders in India’s financial ecosystem have mixed views on the possible introduction of stablecoins.

Payments Industry Perspective

At the CII-Financing Summit in Mumbai on November 17, Visa’s Group Country Manager Sandeep Ghosh said stablecoins could modernise cross-border payments by offering:

• more scale

• faster processing

• lower costs

Capital Markets’ Concerns

NSE CEO Ashish Chauhan warned that stablecoins may:

• Weaken regulatory oversight

• complicate money-laundering prevention

• expose financial markets to manipulation

RBI’s Preference for CBDCs Over Stablecoins

The Reserve Bank of India continues to maintain a clear stance against cryptocurrencies.

RBI Governor Sanjay Malhotra has urged global central banks to prefer Central Bank Digital Currencies (CBDCs) instead of stablecoins for international payments.

The RBI is currently piloting:

• Retail CBDC

• Wholesale CBDC

Malhotra recently reiterated that cryptocurrencies have implications for monetary policy, capital flows, and money laundering risks.

Experts Call for Sandbox Testing

Market experts believe stablecoins should be treated as speculative assets because their price stability depends on the asset they are pegged to.

Vivek Iyer, Partner at Grant Thornton Bharat, said a sandbox environment under the Department of Financial Services would help study the risks associated with stablecoins. Such analysis could guide future regulations.

India is Still at the Discussion Stage

With no regulatory framework and no legal recognition for cryptocurrencies, India is moving cautiously. The government is weighing:

• global trends

• domestic financial system preparedness

• risks related to volatility, fraud, and regulation

• benefits in payments and technology

The final approach—whether to allow stablecoins in limited use cases or to build a broader regulatory structure—will depend on the findings presented in the upcoming Economic Survey and the crypto discussion paper.

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