The Reserve Bank of India has been working on its digital currency for a long time. Speaking to CNBC, Governor Shaktikant Das said the RBI could launch a test program for its digital currency by December 2021. Central banks around the world are working in this direction. The central banks of China, Europe and the UK are considering possibilities for commercial and public use of cryptocurrency. (RBI’s own cryptocurrency may come by December, Governor Shaktikant Das’s big statement)
The digital currency or cryptocurrency issued by any central bank is called CBDC (central bank digital currencies). This currency will have full legal recognition. Experts say it will be a digital version of the current Fiat currency. We are very cautious about CBDC, as it is a completely new concept, explained Shaktikant Das.
Evaluating the impact on the financial system
The Reserve Bank is seriously considering various aspects of digital currency. First of all, it must be safe in every way. In addition, it should not have any negative impact on the Indian financial system. Especially after Corona, there is still pressure on the economy. In such a scenario, the central bank is extremely cautious about the financial markets.
India ranks second in the cryptocurrency adoption index
The craze for cryptocurrency in India has increased a lot since the ban was lifted by the Supreme Court. India ranks second in the Global Crypto Adoption Index 2021. It has overtaken countries like China, USA, UK and England. Between June 2020 and July 2021, the acceptance rate of cryptocurrencies increased by 880 percent. Compared to the third quarter of 2019 (October-December 2019), it has recorded a historic increase of 2300 percent.
Work continues on various aspects
After a meeting of the Monetary Policy Committee in August, Deputy Governor T Rabi Shankar had said that the Reserve Bank could bring a model of operation of legal digital currency by the end of this year. He had said that work was being done on all aspects of the currency, including technology, distribution system and certification system. On July 22, he said India was considering introducing digital currency in phases.
Concerns over private cryptocurrency
Shankar said that work on digital currency has been going on for many years. However, the growing popularity of private cryptocurrencies such as Bitcoin and Ethereum has attracted attention. All of these cryptocurrencies are based on blockchain technology. At the MPC’s press conference, Governor Shaktikant Das said the central bank’s concern was about private cryptocurrency. He said it has not been controlled yet and the matter has been shared with the government. (RBI’s own cryptocurrency may come by December, Governor Shaktikant Das’s big statement)