Bank of Russia has suggested a possibility of issuing its own central bank digital currency, the digital ruble, in a new report published by the central bank today. The digital ruble will be an electronic version of the Russian national currency and will complement cash. The bank said that users will be able to use digital wallets for the CBDC and also convert their money “freely” between digital rubles into cash or bank account, and back.
The bank reasoned that it wanted to introduce a CBDC because “digital financial technologies” usage was expanding in Russia and elsewhere since a growing number of its citizens now preferred cashless payments. In fact, the nation ranks second in the global adoption of cryptocurrencies in Eastern Europe, as suggested by a study from Chainalysis, a crypto research company.
But when it comes to the usage of private cryptocurrencies, Russia has been strict in that regard. It has even passed new regulations on crypto-trading and mining which will not allow its citizens to use crypto for payments from 2021 onwards. Meanwhile, a group of central banks from several nations recently came together to discuss whether or not to introduce CBDCs in their jurisdictions. Russia was not part of this discussion.
Bank of Russia aimed to acquire feedback from the public, especially financial market participants, and “experts” regarding the digital ruble project. It believed this consultation would encourage public participation in the project. The bank said it would compile the feedback and other data to eventually pilot the CBDC project. In recent news, the European Central Bank has already started surveying public opinions on the implementation of the digital euro.
It must be noted that the report did not specify a timeframe for the development of the digital ruble or whether it would launch the CBDC immediately.