“These (CBDCs) are extremely scalable technologies and business choices that one has to make, and so it’s difficult to set a date, but we should be able to come up with a model in the near future – probably by now.” the end of this year. “, the vice-governor told reporters at the post-Monetary Policy Committee (MPC) press conference, without specifying other deadlines.
“… we are assessing the issue of scope, technology, delivery and validation mechanism, etc.” Sankar said. Earlier in July, Sankar said RBI was working on a “phased implementation strategy” for CBDC in India, where a pilot project to test a general-purpose digital currency is a possibility in the near future.
Certainly, a CBDC is a form of virtual currency or cryptocurrency issued by a central bank as an alternative to its currency. They are largely stable coins backed by sovereign reserves, and unlike private crypto assets like Bitcoin or Ethereum, the value of these digital coins is not subject to volatile market fluctuations.
The vice governor said in July that the RBI defined the CBDC as legal tender issued by a central bank in digital form. âIt’s the same as fiat money and is exchangeable one by one with fiat money. Only its shape is different, âSankar said.
With the intention of RBI, India has joined China, Russia and the United Kingdom among the major economies evaluating the issuance of their own digital currency.
Currently, as Sankar has pointed out, RBI is closely examining several aspects of launching a general-purpose, population-wide CBDC. This includes reach – whether it’s retail or wholesale; technology – distributed ledger or centralized ledger; validation basis – a token or account based system; and distribution format – issued directly by the central bank or by banks.
A favorable legal framework is also being studied by central bank officials. This will include changes to several sections – 24,25,26 – of the RBI Act as well as the provisions of the Currency Act 2011, the Foreign Exchange Management Act, and the Information and Information Act. technology.
At an MPC press conference on Thursday, RBI Governor Shaktikanta Das also reiterated that the central bank’s concerns over the continued use of private cryptocurrencies such as Bitcoin and Ethereum in India have been transmitted to the government, which will make the final decision on the regulation of these virtual currencies. currencies soon.