CBDC is one of the things that is quite active in discussion and now the Reserve Bank of India has started talking about it. CBDC is a short form of central bank digital currency these days countries are exploring the option to go with CBDC and figuring out how can it help the country's economy.
Digital currency is the future and its high time when countries need to look into this to see how can they move forward with it. Although we have cryptos with us and its a growing segment as we can see many more companies and some countries changing their mindset with crypto however they would not accept cryptocurrency. To have their own digital currency CBDC is the way that can give their citizens a digital payment option. technology is evolving and it has certainly made the payment process easy and that too with digital money we can pay off seamlessly.
A CBDC is essentially a legal tender issued by the central bank, as the name suggests. It has the same functional capabilities as a fiat currency and is considered exchangeable in nature with said fiat currency in a one-to-one form. The only notable difference is the form it takes, i.e., a digital form. While it is a digital currency, it is important to differentiate it from existing private digital currencies such as Bitcoin and Ethereum. Private crypto assets such as those have no legal issuers and they cannot be considered as money or currency, whereas the CBDC can be.
Things are moving toward digital form and its necessary to bring the legal digital currency and that's where CBDC is important. Coming such updates from RBI brings a positive sentiment that soon India is going to have its digital currency however there is no update about how to use it. RBI seems to be positive for crypto as well however getting official regulation documents is taking time and the community is looking forward to having it as soon as possible.
India is one of the countries that adopt the latest technology faster but in this segment its taking time whereas they should expedite it so that they can early more with digitization with digital money an crypto. It would certainly be good to have our digital currency but I hope that RBI and government also think more about crypto and come out with some solid proposal to regulate crypto and give people an official power so that more investors can be part of it.
Thank you so much