Business News: RBI Governor Shaktikanta Das on a virtual meeting held said, that the RBI is currently in process to come up with its own digital currency similar to the cryptocurrencies and will build its own blockchain platform to trade the currency without any intermediaries. He said that India should not left behind in the technological revolution.
The digital currency which will be known as by the RBI, Central Bank Digital Currency (CBDC) will be different than the ones like bitcoin and Ethereum. This CBDC will traded in a private blockchain platform unlike the public ones which the government is keen to regulate at the least or restrict at the most.
The blockchain platform that RBI will build will be similarly like the UPI payments interface, where private companies can also build their own apps to trade the RBI provided digital currencies. What should be noted here is that RBI said that there will no intermediaries like banks with cash that provide people the currencies to trade.
Although there is a possibility that the new CBDC will provided through banks. Instead of going through banks, RBI plans to distribute the currency in a peer-to-peer method, where the currencies will be centrally controlled fully by the RBI themselves. One thing has been made clear by the RBI, that they want control over the trading of any digital currencies.
This form of control will be utterly impossible in case of Bitcoin or Ethereum. These cryptocurrencies are free from any kind of government control. Last week, Ministry of Finance and Corporate Affairs asked companies to disclose all the cryptocurrency trade if ever taken.
Even SEBI (Securities Exchange Board of India) does not have a legal framework to control the cryptocurrencies as they are neither securities nor commodities. RBI and Central Government are coming up with a new bill known as The Cryptocurrency and Regulation of Digital Currency Bill, 2021 which once ratified will enable RBI to come up with its digital currency.
Though the government does not want the cryptocurrency to exist independent of their control, it also wants to leverage the opportunities and benefits that cryptocurrencies offer.