Crypto: The Reserve Bank of India has made the decision to launch its own digital currency in India. Governor of the Reserve Bank of India Shaktikanta Das has stated that a pilot project for the RBI’s digital currency might be launched by December.
Das stated that the RBI is working on a gradual implementation of digital money in the country. He stated that the RBI is highly concerned about the central bank’s digital currency. This is a brand-new product, thus there can be no space for error.
The popularity of crypto currencies is growing all around the world, and the number of investors in India has surpassed one million. A circular issued by the Reserve Bank of India in 2018 was just invalidated by the Supreme Court. The Reserve Bank of India (RBI) has previously prohibited banks and financial organizations from trading with crypto currencies or providing financing for them.
Think before investing in Crypto
Recently, the PM of India in a speech said think before investing in crypto currency. There are various aspects and reasons one must think deep and analyze the pros and cons before choosing the path weather it is away from the crypto or towards crypto.
Crypto currencies have the subsequent disadvantages that probably everyone ignore before investing in urge to earn money –
• The almost hidden nature of crypto currency transactions makes them easy to be the main target of illegal activities like concealment , tax-evasion and possibly even terror-financing
• Payments aren’t irreversible
• Crypto currencies aren’t accepted everywhere and have limited value elsewhere
• There is concern that crypto currencies like Bitcoin aren’t rooted in any material goods.
Some research, however, has identified that the value of manufacturing a Bitcoin, which needs an increasingly great deal of energy, is directly associated with its market value .
What will be unique about the RBI’s CBDC?
The Reserve Bank of India’s, Central Bank Digital Currency (CBDC) will be legal currency. The CBDC will be backed by the Indian central bank. It will function similarly to traditional cash, but in a digital format. You will be able to transact using CBCD in the same manner that individuals provide cash in return for products or services. The main distinction from currency notes will be that it will be in digital format.
Digital money is not a new concept
It’s also worth noting that the concept of introducing digital currency isn’t brand new. Many experts have recently claimed that the notion of central bank digital money was inspired by American economist and Nobel Laureate Tobin. In 1980, he proposed a computerized method of payment.
What is the purpose of CBCD?
The rising popularity of Bitcoin central bank digital money throughout the world may be attributed to three factors. Simpler format than central bank paper currency, easier to promote electric currency, easier to use and popularize physical cash, and easier to issue or even withhold. The central bank is serious about bringing CBDC to market to suit people’s digital currency requirements. The usage of private virtual money is steadily rising in the country, and CBDC was created to prevent losses caused by such private currency.
