Q72 · UPSC Prelims 2023 · Set A · Current Affairs and GK

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With reference to Central Bank digital currencies, consider the following statements:1.It is possible to make payments in a digital currency without using US dollar or SWIFT system.2.A digital currency can be distributed with a condition programmed into it such as a time-fame for spending it.Which of the statements given above is/are correct?

A 1 Only
B 2 Only
C Both 1 and 2
D Neither 1 nor 2

Correct answer: (c) Both 1 and 2

Explanation

  1. A

    1 Only

    1 only. Programmable expiry is also a CBDC design option.

  2. B

    2 Only

    2 only. Cross-border CBDC can bypass dollar/SWIFT rails.

  3. C

    Both 1 and 2

    Both. Payments without USD/SWIFT, and programmable conditions such as a spending window.

  4. D

    Neither 1 nor 2

    Neither. Both are standard CBDC talking points.

Summary. Official key is (c) both. A central-bank digital currency can settle without using the US dollar or SWIFT. It can also carry programmed conditions (a time window, a merchant category). Both statements hold.

Same topic · past papers

UPSC has asked this before

These previous-year questions sit on the same topic. Open one to practise the earlier ask.

  1. 2026 · Q90 · General Studies · 2 marks

    Which one of the following statements about Unified Payments Interface (UPI) and Central Bank Digital Currency (Digital Rupee) is NOT correct?

    View answer →

  2. 2016 · Q14 · General Studies · 2 marks

    Recently, which one of the following currencies has been proposed to be added to the basket of IMF's SDR?

    View answer →

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