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Why does India need Digital Rupee? RBI deputy governor says to avoid cryptocurrency’s damaging consequences

Speaking at a webinar, the RBI deputy governor examined key issues related to bank-backed digital currencies and spoke about why they were important given the advent of cryptocurrencies.  The Reserve Bank of India is working towards a "phased implementation strategy" for the introduction of central bank-backed digital currency (CBDC), Digital Rupee, and examining use cases to ensure that its execution does not cause any disruption. Unlike cryptocurrency or private virtual currency (PVC) which is issued by private entities, a CBDC (same as a fiat currency) is issued by a country's central bank, and is backed by assets such as government securities. It is also exchangeable one-to-one with the fiat currency. Why does this matter: On January 29, according to an official Lok Sabha Bulletin, the Indian government had proposed to introduce a new bill to ban trading and investments in cryptocurrencies, which would at the same time, provide the RBI with necessary legal powers to develop a CBDC. Although the said bill has not been introduced yet, despite rumours that it may be brought in during the ongoing Monsoon Session, the RBI has time and again made its case for CBDC against cryptocurrency or private virtual currency. RBI deputy governor T Rabi Sankar who was speaking at a webinar organised by the Vidhi Centre for Legal Policy said that the central bank is currently examining some key issues in regards to its implementation. They are — Whether bank-backed digital currencies should be used in retail payments or in wholesale payments Determining…

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Among other subjects, I cover the increasing usage of emerging technologies, especially for surveillance in India

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