A large majority of Central Banks around the world are working to develop their own Central Bank Digital Currency (CBDC). The objectives pursued are not the same in each case. If some governments want to take an active part in the development of this market, there are some whose goal is to create a CBDC to combat the growth of cryptos. This is the case of India. The country has, from the start, displayed its opposition to the digital asset market. Recently, Rabi Sankar, Deputy Governor of the Central Bank, said that he strongly believes that CBDCs can ” kill “ cryptos. According to him, the latter carry within them the germ of “destabilizing monetary and fiscal stability”.
A CBDC programmed to eclipse other cryptos?
On October 31, the Central Bank of India (RBI), announcement that she will launch the 1er November, the wholesale digital rupee sale (CDBC-W). The CBDC-W is available for the settlement of transactions on the secondary market for government securities. It allows restricted access to certain financial institutions. It can also intervene in the settlement of interbank transactions. The authorities assure that it will reduce transaction costs.
Additionally, the RBI clarifies that the retail version of the Indian CBDC (CBDC-R) will be available within a month. A pilot project will also be launched in this direction. This pilot phase will lead to the distribution of the CBDC-R in closed user groups including customers and merchants. It can be used by everyone, including the private sector, non-financial consumers and businesses. It is an electronic version of fiat currency in circulation.
The government has selected nine leading banks to distribute its crypto in the territory. These are State Bank of India, Bank of Baroda, Union Bank of India, HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Yes Bank, IDFC First Bank and HSBC.
While one of New Delhi’s primary goals is to curb crypto adoption, the country expects the digital rupee to support the digital economy, boost financial inclusion, and make monetary and more efficient payment. Last month, the RBI said its CBDC will be one of the most innovative in the world. It relies in particular on speed, efficiency, accessibility and affordable costs.
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