India’s Central Bank Advises Nations To Adopt CBDCs Over Stablecoins

TLDR

Table of Contents

RBI warns stablecoins could create risks during periods of market stress
India’s central bank backs CBDCs as anchor for trust in national currency
Only 3 countries have launched CBDCs; 49 are in pilot stages
Stablecoin market rose from $205B to $307B in 2025, says DefiLlama

India’s central bank has called on global financial authorities to give priority to central bank digital currencies (CBDCs) over privately-issued stablecoins. The Reserve Bank of India (RBI) made this recommendation in its latest financial stability report, citing concerns over financial trust and the potential risks stablecoins pose to the monetary system.

RBI Calls for Prioritizing Sovereign Digital Currencies

The Reserve Bank of India has asked countries to consider central bank digital currencies as the preferred option over stablecoins. This was outlined in the central bank’s December 2025 financial stability report, which focuses on emerging trends and risks in the financial system.

The RBI said that CBDCs preserve the “singleness of money” and help maintain the “integrity of the financial system.” It noted that CBDCs should be the “ultimate settlement asset” and remain the “anchor for trust in money.” These statements reflect a broader concern about the rising role of private digital currencies in global finance.

🇮🇳 RBI IS QUIETLY LAYING THE FOUNDATION FOR INDIA’S NEW FINANCIAL ERA!
• STABLECOINS : Flagged as a risk to the financial system, tighter oversight likely
• CBDCS : Strongly supported as the future of digital money
HERE’S WHAT THE DATA SAYS:
• BANKS : Bad loan ratio expected… pic.twitter.com/lBNPMjUuoB
— Wise Advice (@wiseadvicesumit) December 31, 2025

The central bank emphasized the need to safeguard monetary sovereignty. It stated, “The RBI strongly advocates that countries should prioritise central bank digital currencies over privately issued stablecoins to maintain trust in money, preserve financial stability and design next generation payments infrastructure that is faster, cheaper and secure.”

Stablecoin Risks Cited by RBI

The RBI said stablecoins may pose risks to financial stability, especially in times of market volatility. The report warned that stablecoins could open new risk channels and may not offer the same level of trust as sovereign-issued currency.

It also stated that countries need to assess the potential risks of allowing stablecoins to operate within their financial systems. This assessment should guide future policy decisions to protect existing financial structures.

India’s central bank remains cautious about the broader cryptocurrency market. It said stablecoins fall into the same category of concern, even though they are often promoted for their utility in cross-border payments and faster settlements.

CBDCs Seen as Secure and Efficient

According to the RBI, CBDCs can offer all the core benefits linked with stablecoins. These include efficiency, programmability, and real-time settlement. However, CBDCs carry the credibility of being backed by the central bank, which gives them a secure status in national economies.

The RBI argued that a state-issued digital currency would better serve the public without the risk of instability. It added that CBDCs could support the development of secure digital payment infrastructure while maintaining monetary control.

The RBI stated, “CBDCs can achieve all the same benefits stablecoins offer but with the credibility and safety of central bank money.”

CBDC Adoption Remains Limited Worldwide

Despite growing interest, global CBDC rollouts remain limited. According to the Atlantic Council’s CBDC tracker, only Nigeria, the Bahamas, and Jamaica have launched functioning CBDCs. Another 49 countries are currently piloting digital currency projects, while 20 are developing technology, and 36 are researching the concept.

Meanwhile, stablecoins continue to gain momentum in global financial markets. Data from DefiLlama shows the market capitalization of stablecoins rose from $205 billion to $307 billion in 2025. Several financial institutions in the US, Europe, and Asia are using stablecoins for faster and lower-cost transactions.

The Indian government noted in its Economic Survey 2025–2026 that it is reviewing potential regulation for stablecoins. However, the RBI continues to adopt a more cautious approach, emphasizing digital currencies issued by the state as a priority.