India has long been working on its CBDC plans. The country has a love-hate relationship with cryptocurrencies. The Reserve Bank of India wants to ban Crypto assets outright. On the other hand, the state levies 30% tax and 1% TDS on cryptocurrencies.
Although the country’s acceptance of crypto is not very high, blockchain technology has been warmly welcomed and adopted by many government agencies. Additionally, the government is working to release its own CBDC. After years of research, the Reserve Bank of India released the CBDC concept on October 7, 2022. The Reserve Bank of India plans to launch a wholesale CBDC pilot on November 1.
India to release retail CBDC version within a month
The central bank of India said the main use case for the country’s CBDC would be “to resolve secondary market transactions of government securities.” This is mainly because it reduces transaction costs.
The central bank has selected nine prominent banks in the country to launch a pilot project. The banks selected for the pilot are: HDFC Bank, ICICI Bank, Kotak Mahindra Bank, State Bank of India, Bank of Baroda, Union Bank of India, Yes Bank, IDFC First Bank and HSBC.
The retail version of the CBDC will be deployed for specific customers and merchants in specific locations within a month.
For many, India’s stance on crypto is unclear. While the country wants to ban them all at once, doing so will not be possible without the cooperation of international regulators.
Earlier this month, cryptocurrency companies also objected to the outdated practices of the Reserve Bank of India. However, they made it clear that CBDC cannot replace Crypto assets. Despite the confusing and questionable regulation of crypto in India, the number of users in the country is still growing.
Source of information: Compiled from WATCHER by 0x Information.The copyright belongs to the author, Vignesh Karunanidhi, and may not be reproduced without permission