The Reserve Bank of India’s (RBI) digital rupee will run on a government-mandated electronic wallet that will allow the central bank to be the middleman between merchants and customers, a top government official told the Press Trust of India.
- The government official said the nation’s central bank digital currency (CBDC) is likely to launch early next year.
- The digital currency would be numbered in units, just as every fiat currency has a unique number.
- Finance Minister Nirmala Sitharaman announced in her recent budget speech that India will be launching its own CBDC while imposing a 30% tax on all income on cryptocurrency.
- Digital currencies issued on the blockchain, such as the expected digital rupee, will permit governments to trace all transactions, unlike the current system of mobile wallets offered by private companies.
- In the case of a digital rupee, the currency will be stored in state-backed wallets on devices.