India is almost banned cryptocurrencies, had it not been restored by the Supreme Court but this is pretty myopic. India should be open to the possibility of using the cryptocurrencies for international payments bypassing the dollar.

Bitcoins were mines independently with no control of the central bank. Therefore, these are unstable currencies. Besides, the maximum quantity of bitcoins produced is predetermined. All crypocurrencies are not the same. Stablecoins is a sub-group of cryptocurrencies which are linked to fiat currency managed by banks or other reliable entities.

Such currencies can be used for settling international payments without involving US counterparty — without using dollar. Keynes had suggested on behalf of Britain Bancor but the idea was abandoned. US derives its strength as dollar is the principal currency of world trade. US can borrow as much as it wants, and repay by printing dollar bills. Other countries do not have this advantage.

Dollar has been used as a weapon by the US, e.g. the sanctions on Iran. If any nation transacts with Iran, it will not have access to dollar payment network. No bank can afford this.

The solution is to have a payment system allowing transactions not involving US counterparty. These transactions will be settled in currency other than the dollar. Of course, there could be settlement in Euros, or Yen if you have these in reserve. Otherwise, dollar is the only alternative.

Actually, side-stepping the dollar is a political decision. Technically, the solution could be a blockchain-based currency.

Banning cryptocurrency is akin to not participating in this.

Caution is to be exercised while using cryptocurrency that there is no money laundering and heists.

It will facilitate cross-border remittances by the Fintechs. Instead of banning, India should tie up with others to create cryptocurrency and be a part of settlement system. A new stablecoin can be linked to a basket of currencies. A credible body should regulate the basket and linkage.