<h1><strong style="background-color: rgb(250, 204, 204);">Central Bank Digital Currency (CBDC)&nbsp;</strong></h1><p><br></p><p><img src="https://sunyaias-resources.s3.ap-south-1.amazonaws.com/content/09503546-2dfd-11ec-af99-1fdaf11e191a.png"></p><h2><strong style="background-color: rgb(255, 255, 204);">Context:</strong></h2><ul><li><span style="background-color: rgb(252, 252, 252);">The Reserve Bank of India (RBI) is </span>working on a&nbsp;<strong>phased implementation strategy</strong>&nbsp;for its own<strong>&nbsp;digital currency</strong>&nbsp;and is in the process of launching it in&nbsp;<strong>wholesale and retail segments in the near future.</strong></li></ul><p><br></p><h2><strong style="background-color: rgb(255, 255, 204);">Digital Currency:</strong></h2><ul><li>It is a&nbsp;<strong>payment method</strong>&nbsp;that is simply the digital form of a <strong>country’s fiat currency.</strong></li><li>It can be<strong>&nbsp;</strong>transferred between entities or users with the help of technology&nbsp;like computers, smartphones, and the internet.</li><li>This token value is<strong> backed by the full faith </strong>and credit of the government and does not possess any intrinsic value.</li><li>We do not have any CBDC as of now.&nbsp;</li></ul><h2><br></h2><h2><strong style="background-color: rgb(255, 255, 204);">Recent Development:</strong></h2><ul><li>El Salvador, a small coastal country in Central America, has become the&nbsp;<strong>first in the world to adopt Bitcoin, as legal tender.</strong></li><li>The Bahamas launched the world’s first CBDC last year</li><li>The U.S., the European Union, and China have been working to issue their own CBDCs&nbsp;</li></ul>