Shaktikanta Das – the governor of the Reserve Bank of India – said the financial institution could launch its first trial programs for a digital rupee by December this year. The initiative would determine the security of the Indian CBDC and its impact on the local economic network.
India’s Approach to a CBDC
In a recent interview for CNBC, Shaktikanta Das revealed the Reserve Bank of India’s plans to begin trials for a central bank digital currency before the end of this year. RBI’s mission would be to examine how a potential e-rupee would be incorporated in the Indian financial sector. The trial programs would also analyze the security of the future project:
“I think by the end of the year, we should be able to – we would be in a position, perhaps – to start our free trials.”
CBDC is a digital form of currency issued by a central bank. A country’s monetary authority regulates it and, as such, is highly centralized. CBDCs are still unexplored sufficiently as a financial instrument, and many experts doubt whether they will bring positives or negatives to the monetary system. With that said, Das asserted that RBI would take the matter under close attention:
“We are being extremely careful about it because it’s a completely new product, not just for RBI, but globally.”
RBI’s governor added that the central bank is split between having a centralized ledger for the digital rupee or the so-called distributed ledger technology (DLT). The latter enables the access of numerous participants while a single entity – in this case, the Reserve Bank of India – controls and operates the former.
Indians Are Keen on Cryptocurrencies
While it is still early to conclude whether the population of India would be supportive of launching a digital rupee, one thing is for sure: they love virtual assets like Bitcoin and Ethereum.
As CryptoPotato recently reported, Indians have invested in cryptocurrencies 200 times more in 2021 than in 2020. Surprisingly, the locals, who are well known as gold-lovers, started changing their investment strategy from the precious metal to digital assets.
According to the statistics, the number of people who trade cryptocurrencies in India is 15 million. It significantly surpasses a well-developed country such as the UK, where 2.3 million individuals have entered the market. Moreover, the world’s largest economy – the US – with 23 million merchants does not stand far away from India.
In fact, only one country has a higher index score of global crypto adoption than India, and that is Vietnam. It is worth noting that in 2020, the second-most populated country did not even appear on the top 10 list.