Should India Delay CBDC Trials Amid Crypto Meltdown? Professional Weight Scales
India, despite its reluctance to make crypto a part of its financial systems, has shown growth in putting the country’s fiat currency on the blockchain. India’s digital CBDC rupee pilot project went live earlier this month, and at the same time the FTX crypto exchange collapsed, wiping out more than $200 billion (roughly Rs. 16,32,940) from the global crypto market. Industry insiders have now decided that Indians need to connect CBDCs with the crypto sector and are concerned about financial risks amid the ongoing collapse of the crypto industry.
CBDCs and cryptocurrencies, both are built on blockchain, which is a form of distributed ledger technology. The main difference between them is that CBDCs are issued by central banks and regulated, but cryptocurrencies are not regulated by central banks and are not primarily regulated.
In an interview with Gadgets 360, Alankar Saxena, Chief Technology Officer and Co-Founder of Mudrex reminded Indians that our CBDC is just a common rupee on the blockchain and is not affected by the volatility of the crypto market.
“The digital rupee CBDC will stand out regardless of the downturn in the crypto market. There will be no significant impact on the digital rupee. Instead, it can help people get into the cashless system, and improve transparency,” said Saxena.
Earlier this month, RBI governor Shaktikanta Das called the launch of India’s CBDC pilot a historic moment in the history of the country’s currency.
“This is something that we have to proceed with carefully. Will try and introduce CBDC in full form in near future. It’s the first time the world has done it. We don’t want to rush, we want to learn from what is happening,” said Das at the time.
With the CBDC trial, India is making clear progress in digitizing its economy and the country should not delay the process any longer, say industry insiders. The launch of the test is said to have created a lot of excitement in India.
The Reserve Bank of India is taking the first step to implement crypto in India with the launch of the Digital Rupee Pilot Project.
The payment system is expected to be affordable, accessible, simple, efficient, safe and secure.#crypto #cryptonews #cryptoforce #cryptoindia— Akshit Khanna (@khannaakshit29) October 4, 2022
3. How do you use the rupee?
The commercial version is token based. Basically, you get the recipient’s public key and transfer money to them using your private key. In simple words, transferring money through UPI, same process or like Paytm wallet money of yesteryears.4/n pic.twitter.com/aRTwOIpX5K
– Siddharth Alok (@sidalok7) November 6, 2022
Speaking to Gadgets 360, Mohammed Roshan, Founder and CEO of crypto-focused fintech firm GoStats said anyone concerned about the financial risks surrounding CBDCs can relax. He emphasized that the RBI has repeatedly clarified that CBDCs are completely different from cryptocurrencies and are intended to improve existing financial systems.
“The way the RBI has positioned CBDC, it seems very different from crypto. I don’t think the RBI will see the connection between the CBDC and the decline in crypto markets and will continue with its plans,” Roshan commented.
In a recent report, the KuCoin crypto exchange says that India currently has more than 115 million crypto investors, making up 15 percent of its population.
The pressure to invest in the crypto market has increased significantly in Indian cities. CoinKickoff recently included Bengaluru, Chennai, and Ahmedabad among the twenty most ‘crypto-stressed’ cities in the world.
The market downturn has caused a lot of concern about participation in the crypto sector, or related projects. The layoffs that plagued the industry after the crypto crash also caused tension among people working in the industry.
The ongoing regulatory framework that applies to crypto laws around the world has also emerged as the main reason why investing in these digital assets seems to be pressing in several parts of the world, including India.
Cryptocurrency is an unregulated digital currency, not legal tender and subject to market risks. The information provided in the article is not intended to be and does not constitute financial advice, trading advice or other advice or recommendations of any kind provided or endorsed by NDTV. NDTV shall not be liable for any loss arising from any investment based on any implied recommendation, forecast or other information contained in the article.
