Indian Central Bank Aims to Launch Digital Rupee, Begins Trials By the End of the Year
The Reserve Bank of India (RBI) has laid out plans to launch its digital Rupee. The Asian country will start experimenting by year-end. India will join other top countries like China that are discussing the topic.
Governor Shaktikanta Das of RBI broke the news on Thursday. He stated that the country would start the trial for the Digital Rupee in the last quarter of the year. The move is to diversify the country’s economy and boost its growth. The Central Bank is still observing the various sections of a CBDC in a world where there’s an increase in demand for e-currencies.
The Central Bank Is Meticulous About the Launch of the E-Currency
While several countries have taken huge steps to delve into digital currencies, Das noted that India’s Central Bank is meticulous about the whole process. He explains that it’s still novel and that the world hasn’t fully understood yet
Above all, they don’t know how it would affect the economy. Das also revealed that they are looking to see if it would affect the monetary policies in place.
Das further clarified that they are still deciding to use a centralized lever for the eCurrency or a DLT. A centralized ledger is a database that is run and owned by an individual body. On the other hand, Distributed Ledger Technology is a computerized database that enables several participants to validate transactions and share information at once.
Central Banks Are Considering Launching e-currencies
After some countries reported cash shortage last year, central banks globally stepped up efforts to delve into cryptocurrency to arrest the situation. China led the process by initiating trials for their digital Yuan in many cities. The European Central Bank and the United Kingdom also indicate interest in joining the digital currency league.
Although the rising interest in digital currency might have engineered the move, various CBDCs have come out to say that they differ from cryptocurrencies. First, the digital currencies would be regulated and have a central body, unlike other cryptos that employ a decentralized model. Also, the digital currencies will not be traded or exchanged with Bitcoin and other altcoins; they would function like fiat currencies and have a general acceptance. The reason for this is to avoid the frenzy fluctuating prices of Bitcoin, as they envision that they might cause more harm to the economy.
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