Digital currency
Finance Minister Nirmala Sitharaman has announced in the Budget that the Reserve Bank will introduce the Digital Currency (CBDC) in the country. The budget also says that the digital rupee blockchain and other technologies will be used. The digital currency is seen as the government’s next move to nurture the Indian digital economy. The digital currency, which is inspired by the cryptocurrencies Bitcoin and Ether, will be controlled by the Reserve Bank. This is what differentiates the digital rupee from crypto.
India’s digital currency will be more efficient and simpler. The finance minister had said in the budget that this would make it easier for currency management. Let us see what makes India’s digital rupee different from other cryptocurrencies.
In simple words, digital currency is the digital form of the rupee. CBDCs will be a safe, powerful and convenient payment mode as an alternative to physical currency. The advantages of digital currency is that it is indestructible. Another feature is that it can’t be robbed. The lifespan of digital currency is infinite compared to ordinary currency notes.
Reduce cost of printing
The biggest benefit to the government of converting to digital currency is that it can reduce the cost of printing currency notes. Unlike other cryptocurrencies, the digital rupee will be controlled by the Central Bank. The bottom line is that Bitcoin is not like cryptocurrency with unknown sources. That is the biggest difference between the digital rupee and other cryptocurrencies.
Digital currency and other private cryptocurrencies will be based on decentralized blockchain technology itself. This data will be stored on a wide computer network. This system can provide great protection against cyber threats. It is expected that the RBI will bring more clarity on the confidentiality of transactions and the inclusion of personal data.
