On 1st Feb 2022, a Tuesday morning, Finance Minister Nirmala Sitharaman confirmed that the Reserve Bank of India will issue digital rupees soon. The RBI’s digital currency will be built on the blockchain platform.
HIGHLIGHTS
- FM RBI Governor Nirmala Sitharaman has confirmed that a digital rupee will be issued.
- Blockchain technology will be used to create a new digital cryptocurrency.
- By 2022-23, it will be available.
On Tuesday morning, Finance Minister Nirmala Sitharaman confirmed that the Reserve Bank of India will issue a digital rupee soon. The RBI’s digital currency will be based on blockchain technology, which is the same technology that powers Bitcoin and other popular cryptocurrencies. The finance minister stated that a digital rupee would be issued by 2022-23, but did not elaborate on the future of Bitcoin and other crypto tokens.
“Digitized currency will also result in a more efficient and cost-effective currency management system.” As a result, starting in 2022-23, the Reserve Bank of India will issue a digital rupee based on blockchain and other technologies,” the finance minister said.
The government may still ban all cryptocurrencies in the country, according to a draught of the crypto bill, in order to promote a possible digital currency from the RBI.
“To establish a framework that will facilitate the creation of the Reserve Bank of India’s official digital currency.” In addition, the bill seeks to outlaw all private cryptocurrencies in India. The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, “allows for certain exceptions to promote the underlying technology of cryptocurrency and its uses.”
During her Budget presentation, the Finance Minister was expected to provide more clarity on the use of cryptocurrency. However, Bitcoin and other cryptocurrencies were not mentioned. Instead, a cryptocurrency tax has been imposed.
Crypto Tax has been announced
In her Budget 2022 presentation, Finance Minister Nirmala Sitharaman announced the introduction of a new crypto tax, under which virtual digital assets will be taxed at 30% in the country. In the event of losses, she clarified that no set-off will be allowed. Furthermore, gifts of virtual digital assets would be taxed in the recipient’s hands.
FUN FACT – One of the shortest delivered Budgets to date, for India.