Indian CBDC To Be Run on Government-Mandated E-Wallet by 2023 End

The developments surrounding crypto and blockchain in India have led to the country creating certain directives and at the same time finding a way around establishing their own controlled medium of cryptocurrency. 

The CBDC Wallets

Since the announcement of the central bank issuing India’s own digital currency the ‘Digital Rupee’, many citizens have been wondering about the how’s and when’s of its implications.

Yesterday, a top government source who preferred to remain anonymous, provided some information on the same. According to the source, the ‘Digital Rupee’ that the central bank – The Reserve Bank of India – would issue will be numbered in units. The process will be similar to the way fiat currencies in the country are issued with a unique number.

Expanding on the same the source stated,

“The units issued in digital rupee would be included in the currency in circulation. It would not be very different from fiat currency. It would be more like an electronic form of fiat currency, so in a sense it would be a government-mandated electronic wallet”

This way not only will the government be able to track every transaction taking place using the CBDCs but also create an ecosystem of blockchain and crypto technology which the government states could provide “a boost to the Indian economy”.

Just last month along with the CBDCs the Minister of Finance and Corporate Affairs, during the budget meeting for 2022-23, announced a 30% tax on cryptocurrency-based income.

Additionally, a 1% TDS has also been levied on payments over a certain threshold in order to keep track of such high valued cryptocurrency transactions.

Less than a week ago a petition was launched in order to counter the imposition of the 30% crypto tax stating that the taxation which is similar to that of Betting and Gambling places crypto in the cynical crosshair. And that “it could have a devastating impact not only on the Industry per se but the economy as a whole”.

CBDCs Around the World

Recent developments surrounding CBDCs around the globe are making it apparent that the next big goal for many governments would be digital currencies since this would allow them to be a part of the growing crypto space without directly affiliating themselves to the existing private cryptocurrencies.

A few days ago The Federal Reserve Bank of Boston (Boston Fed) and Massachusetts Institute of Technology (MIT) released the results of their Phase 1 research of their multi-year CBDC focused research – Project Hamilton. 

And the researchers found that “existing database and distributed systems technology is sufficient to provide a more traditional payment architecture for CBDC”

Furthermore, recently the Bank of Jamaica also announced that the central bank will be moving ahead with the release of their Jamaican Dollar digital currency in the first quarter of 2022.