October 07, 2025
By Anjali Kochhar
India is stepping into the global spotlight as stablecoins begin to shake the foundations of traditional money. Finance Minister Nirmala Sitharaman recently warned that nations must be ready to deal with the fast-evolving world of digital finance and outlined the many challenges India and others will face.
Sitharaman stated that stablecoins, which are cryptocurrencies tied to fiat currencies, are no longer fringe tools for crypto enthusiasts. They are becoming vital infrastructure for cross-border payments, remittances, and global commerce. She emphasised that clear regulations and structural reforms are needed if India wants to stay ahead of the digital curve.
India now finds itself in a challenging position. On one side, stablecoins offer efficiency, lower costs, and faster settlements. On the other, regulators worry about monetary control, financial stability, and the potential weakening of the national payments ecosystem. Many Indians already use U.S. dollar-backed tokens like USDT and USDC for remittances and investment diversification through offshore platforms.
Former RBI executive G. Padmanabhan has warned against “policy drift,” suggesting that stablecoins should be regulated separately from speculative crypto assets. He believes India must act quickly before global powers set the standards.
Meanwhile, other Asian economies such as Japan, South Korea, and China are already moving ahead with pilot programs for digital currencies and stablecoin frameworks. India, however, still lacks a clear regulatory authority overseeing stablecoins. The RBI’s digital rupee (e-rupee) is active, but adoption remains low and coordination with private stablecoins is still uncertain.
Experts warn that if India continues to delay, it could lose its edge in the global fintech race. The country’s prized Unified Payments Interface (UPI) could face fragmentation if stablecoins grow without oversight. Cybersecurity risks also remain a major concern, especially after multiple exchange hacks highlighted vulnerabilities within the system.
Sitharaman’s message was clear: the time for hesitation is over. India must shift from a reactive stance to a proactive one. Global players are already shaping the rules of digital finance, and India needs to decide whether it will create its own playbook or follow others.
If the country establishes smart and balanced rules now, it could emerge as a leader in the digital economy. But if it waits too long, the stablecoin wave may pass it by.
About the author
Anjali Kochhar covers cryptocurrency and blockchain stories in India as well as globally. Having been in the field of media and journalism for over four years now, she has developed a sharp news sense and works hard to present information that goes beyond the obvious. She is an avid reader and loves writing on a wide range of subjects.
