India's CBDC Should Be Able to Do Anything Cryptocurrency Can Do With No Risk. Will India ban Cryptocurrencies?
Indian central bank expressed that if there is anything cryptocurrencies such as Bitcoin and Ether can do, the Reserve Bank of India (RBI) should be able to create a product that will do the same job without the associated risks. This is essentially what we are doing in the CBDC experiments.
We realize that private currencies were evolving. this poses a threat to investors, systems, and the economy. as well as private cryptocurrencies have indicated that digitalizing currency can benefit.
T. Rabi Sankar Refers to non-government-issued cryptocurrencies including Bitcoin and Ether as private cryptocurrencies.
"if there is anything that a private cryptocurrency can do we should be able to create a product that will do that without the associated risks in a safer format in fiat money backed by the government and issued by the central bank this is essentially what we are doing in the CBDC experiments."
The RBI launched its first retail central bank digital currency pilot on Dec 1 with the participation of eight banks the Pilot will eventually cover 13 cities across India the retail digital rupee followed the RBI's wholesale CBDC pilot which began on Nov 1 for the trading of government bonds. the wholesale pilot will later be expanded to cover more use cases.
CBDC noted that the initial CBDC pilots are aimed at ensuring the efficacy of all systems. he stated:
"As we go along, the pilots will focus on identifying the right technology on the right architecture for distrubution of digital currency."
As per the view of T. Rabi Sankar the central bank will build upon the digital infrastructure it is creating emphasizing that there are many possibilities including smart contracts and tokenized bounds.
"There are potentially game-changing choices available, particularly in the area of cross-border transactions. There are a huge amount of inefficiencies in this process that the CBDC can take care of."
Furthermore, the RBI believes that cryptocurrencies should be completely banned in India. also, it would be futile to regulate cryptocurrencies warning that crypto products are fundamentally designed to bypass the established financial system and on a larger scale government itself.