RBI is about to launch a Central Bank Digital Currency: What Is Digital Rupee, How It Works And How It Is Different From Bitcoin and other Cryptocurrencies?
On Tuesday India’s Financial Minister Nirmala Sitharaman announced the Reserve Bank of India (RBI) is going to launch it’s digital rupee — a Central Bank Digital Currency. It will be based on Blockchain technology. She explained that the Reserve Bank of India will launch digital rupee in the next financial year to boost the country’s economy and for a secured system.
Here we will discuss what is digital rupee, how it works and how it’s different from bitcoin and other Cryptocurrencies.
What Is Digital Rupee?
Digital Rupee is India’s digital currency which will be launched by the RBI. It’s a digital form of the country’s regular current — fiat money. It’s based on blockchain technology which makes it secure.
- It is a fiat currency
- Will launch by Reserve Bank of India
- Digital cash can be exchanged with legal currency
- It will be based on blockchain technology
- It will boost country’s economy
- It can also known as Country’s crypto
- much secure(as based on blockchain technology)
How will it works
As it is based on blockchain technology, it will be monitored by the central government. It’s just a digital form of fiat money so it will be exchangeable digitally like regular money. We’ll be able to make payments digitally more easily. But we still don’t have much knowledge about it as the government hasn’t issued any guidelines regarding it.
How it’s different from Bitcoin and other Cryptocurrencies
As digital rupee will be launched and regulated by the Reserve Bank of India (RBI) so it will not be fully decentralized. It will be governed and monitored by the central body. Bitcoin and other Cryptocurrencies are fully decentralized as these are spread globally across a network of computers. Also, digital rupee will be issued as a legal tender.
Conclusion
Digital rupee is a digital form of fiat money. It will be launched by the RBI and it’s a legal tender. It will be easily exchangeable with regular Currency and as it is based on blockchain technology it will be governed and monitored by the central government. Launching the digital rupee will boost India’s economy. It can be known as India’s Crypto but it’s exactly similar to otherCryptocurrencies.
Is Digital Rupee a Digital Asset?
No, it’s not a digital asset. It’s a digital form of fiat money and it’s legal tender.
When will it launch?
India’s digital rupee — a Central Bank Digital Currency will be launched by Reserve Bank of India (RBI) in the next financial year (2022-23)
Who will issue the digital rupee in India?
The Reserve Bank of India (RBI) will issue the digital rupee.
Can I exchange Digital Rupee for paper currency?
Yes, you’ll be able to exchange Digital Rupee for paper currency. RBI can also issue guidelines for it.