CBDC &

Crypto currency

Done By: Vishal V
 What is CBDC ?

• CBDC stands for Central Bank Digital Currency
• Unlike privately held crypto currencies, a CBDC will
have the backing of the RBI and in turn, the
government.
• A share of total INR is converted into digital format.
• It can be exchanged for currency bills but it cannot be
converted into INR by an individual. But the
government would have to power to convert.
 Difference Between CBDC and
Crypto Currency

• Crypto, by nature, works on the basic principle of
anonymity. In case of a digital currency, there will be
complete tracking by the central bank, just like
normal currency.
• Second, crypto currency is decentralized. But a
digital currency is just a digitized format of a
centralized tender
• Examples : Crypto currency – Bitcoin
Digital Currency – China converted Yuan
into digital format.
 Are we using digital currency
through UPI, Cards etc.?

• The short answer is No.
• In case of UPI or card payments, every transaction
made is backed by a currency note somewhere. 
• The bank balance can be converted into currency
notes.
• In case of digital currency that will not be possible,
because it is completely in digital form and there are
no bills anywhere to support that currency.
• It works on people’s trust on the country’s banking
system.
 Legal Status of Crypto in India

• Crypto is neither banned in India, nor is it legalized ,
making it hang somewhere in the grey zone. 
•  The RBI had banned banks from dealing with crypto
exchanges, but that embargo was overturned in
March 2020, by the Supreme Court of India.
•  So technically there are crypto exchanges working
actively across the country, doing their own due
diligence, and working mostly as trading platforms.