LEGAL CHALLENGES IN ADOPTING CENTRAL BANK DIGITAL CURRENCY: A CASE STUDY OF AN EMERGING NATION INDIA
DOI:
https://doi.org/10.62737/z08ng628Keywords:
CBDC, Legal, Central Bank Digital Currency, AML, CryptocurrencyAbstract
By incorporating digital technologies into monetary systems, Central Bank Digital Currencies (CBDCs) are upending conventional banking paradigms and revolutionising global finance. This present study offers a thorough examination of CBDCs, examining their legal intricacies, historical background, and potential effects on financial ecosystems in the future. As central banks work to update the financial system and tackle new issues, CBDCs are becoming more popular. Potential advantages include increased financial inclusion, quicker international transactions, and better regulatory oversight of financial operations. CBDCs use blockchain technology to guarantee transaction security, transparency, and efficiency. This research synthesises different perspectives on CBDCs, highlighting opportunities and legal problems, through an extensive examination of the literature. It highlights how important it is to set up strong legal frameworks that control the issuing and functioning of CBDCs and handle issues with data security, privacy, and anti-money laundering (AML). The study explores the policy ramifications of the implementation of CBDCs, looking at how it affects financial stability, liquidity management, and monetary policy. It emphasises the significance of implementing the CBDC cautiously and supports incremental development, thorough testing, and review. Documentary study from developing nations such as India shed light on the particular difficulties and opportunities associated with the adoption of CBDCs. The study provides a roadmap for the implementation of the CBDC, highlighting the need for continued research and cooperation with global stakeholders to guarantee a seamless transition.
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