Kathmandu. The Nepal Rastra Bank Act, 2058 (amendment) bill has made provision to include ‘digital currency’ as legal currency. Privately issued cryptocurrencies and virtual currencies are not considered currencies or legal tenders.

The Finance Committee of the House of Representatives held clause-wise discussion on the bill designed to amend the Nepal Rastra Bank Act, 2058 BS on Monday.

On the occasion, Executive Director of Nepal Rastra Bank Dirgha Rawal said that the central bank digital currency (CBDC) will be included in the provision of digital currency.

He clarified that there is no need to include crypto and virtual currency in the NRB Act. According to Rawal, the issues related to crypto and virtual currency have already been addressed through the anti-money laundering law.

Finance Secretary Dr Ghanashyam Upadhyay said it was not necessary to lump sum issues relating to digital currency and digital banking system. According to him, there was no need to mention a separate digital currency system as the form and operation system of digital currency fall under its system.

Secretary Dr. Upadhyay suggested that the digital currency specified by Nepal Rastra Bank could be arranged for clarity. He clarified that since currency is primarily related to the central bank, digital currency means the digital currency issued or fixed by the central bank.

According to clause (i) of sub-section 4 of Section 2 of the Act, ‘currency’ means a banknote in circulation as cash and this word also means coins and digital currency issued by banks. In the current law, only banknotes and coins have been included in the definition of currency.

Earlier, the amendments proposed that the term ‘central bank digital currency’ (CBDC) should be considered a digital form of legal currency issued by the bank.

The amendment committee has suggested that the digital currency issued by a bank should be considered as the central bank digital currency (CBDC) issued, controlled and handled by the Nepal Rastra Bank and the virtual currency or cryptocurrency issued by the private sector should not be considered as currency or legal tender for the purpose of the Act.