Key facts:
-
Trials with the new digital ruble would start in January next year.
-
Among the selected banks are Ak Bars, Gazprombank, Rosbank and Sberbank.
Russia is accelerating the pace in the race to implement its central bank digital currency (CBDC), the digital ruble. The country’s monetary entity announced, on Tuesday, June 29, that it has already selected the banks that will participate in the first tests to be executed in January 2022.
The Russian Central Bank has chosen up to 12 local banks to be incorporated into its new digital platform for handling transactions with the digital ruble. The institutions that applied and received the approval are: Ak Bars, Alfa Bank, Bank DOM.RF, VTB Bank, Gazprombank, Tinkoff Bank, Promsvyazbank, Rosbank, Sberbank, SKB-Bank, SOYS Bank and TKB Bank.
“The digital ruble is a project to create a new infrastructure to increase accessibility, reduce the cost of payments and transfers for citizens and businesses. To make it easier to use, it is necessary to ensure a seamless transition from one form of ruble to another,” explained Olga Skorobogatova, first vice president of the Central Bank of Russia.
The Central Bank estimates that, by December 2021, the new systems will be ready, although it is not clear if the developments will be based on a blockchain. If Russia decides to follow in the footsteps of other CBDC projects such as those in China or the Bahamas, then it would not implement a distributed ledger, but would use a centralized database held by the monetary authority.
According to the financial institution, in January of next year the digital ruble will begin to be issued, in test mode, and then other entities will be incorporated for evaluations.
In the case of commercial banks, these would act as intermediaries between the Central Bank and users to, for example, open wallets to customers of the central bank digital currency. That is, under this model, commercial banks would remain operating as trusted third parties.
Russia has been talking about the digital ruble for four years
The Russian government and other institutions such as the local parliament have spoken, at least since 2017, of issuing some kind of national cryptocurrency. Crypto News reported, in November 2018, that lawmakers were analyzing the possibility of raising a stable digital currency or stablecoin project anchored 1:1 with the ruble.
The proposal would be tied to the need to reducing dependence on the United States dollar, boost the national economy and have a free commercialization with its partners on a global scale. Other aspects that could be influencing the momentum that Russia is giving to its project are the Chinese issue and the rise of bitcoin.
The Asian giant has completed multiple tests with the so-called digital yuan. Millions of users have already purchased products and paid for services in dozens of establishments as part of the evaluations made by the local central bank.