The New Threat to India’s Crypto Market

• India’s central bank has proposed linking the CBDCs of fellow BRICS nations.
• The goal is to make cross-border payments for trade and tourism easier.
• The key reason for linking is to avoid using the US dollar for international payments.

India’s central bank, the Reserve Bank of India (RBI), has proposed linking the central bank digital currencies (CBDCs) of BRICS nations, including India’s own e-rupee, China’s digital yuan, and others. The goal is to make cross-border payments for trade and tourism easier, moving away from the need to use the US dollar. 

The proposal could be officially discussed at the 2026 BRICS summit, which India is scheduled to host later this year.

A key reason for linking these digital currencies is to avoid using the US dollar for international payments. Many developing countries see this as a risk to their economic and political stability, especially during global conflicts. In fact, countries in Asia and beyond are increasingly putting more effort into “de-dollarization.”

Another reason why BRICS CBDC linkage matters is the faster and cheaper transactions. If BRICS countries can settle trades directly using their digital currencies, the system could make payments much quicker, cut the costs of exchanging money, and avoid the slow, multi-step process of using US dollars, which adds fees and wait times.

Additionally, India insists the plan is about making payments easier and working together, not about replacing the dollar. However, the US is concerned about actions that avoid using its currency. Past US comments have labeled BRICS projects as “anti-American,” a stance that could lead to increased trade or political tensions.

Possible Impact on India’s Crypto Market

India has always been careful about private cryptocurrencies like Bitcoin, XRP, and Ether. The central bank (RBI) often pointed out the dangers crypto poses to the economy, including financial instability and money leaving the country.

Related: India Pushes BRICS Digital Currency Links to Ease Cross-Border Payments

Because of this cautious stance, India’s crypto market has grown more slowly than others, as it faces challenges like high taxes, unclear rules, and the RBI’s general skepticism.

However, there is an important difference with BRICS digital currencies. CBDCs are built under full regulatory control, while private cryptos operate in a regulatory gray area. For Indian leaders, this means state digital currencies are seen as a policy instrument and not as an alternative to decentralized cryptocurrencies.

If the BRICS digital currency system works and makes international trade cheaper and faster, big businesses and governments might become more open to using digital money and blockchain. Still, this doesn’t automatically mean they’ll embrace cryptocurrencies like Bitcoin.

Plus, the Indian central bank’s cautious stance means that any new rules for private crypto will likely be introduced slowly and carefully.

Related: Bharat Web3 Association Urges India to Reform Crypto Taxes Ahead of 2026 Budget