Russia on Tuesday launched the testing phase of a digital ruble based on blockchain technology in the hope of eventually limiting the impact of international sanctions. “VTB has become the first bank to successfully test digital ruble transactions on its mobile app,” Russia’s second-largest bank said in a statement.
In total, twelve other banks and 600 individuals are also affected by this “test phase”, the Russian Central Bank (BCR) detailed last week. At this stage they will be able to make payments at 30 points of sale located in 11 cities in the country. Eventually, “operations will be free for citizens and with a minimal commission for companies,” said the BCR.
Moscow’s stated goal: to make its financial system more airtight and limit the impact of international restrictions. Unlike cryptocurrencies, which are also based on blockchain (a technology that allows direct transactions from a decentralized ledger), the digital ruble is part of the largely controlled CBDC (“central bank digital currency”).
“Safer” payments
Therefore, it is issued directly by the Russian Central Bank (BCR) and stored in electronic wallets. The security services of the FSB monitor the security of the system. If the authorities say they want a digital ruble to make payments more “secure”, some observers believe, on the contrary, that the introduction of that form of currency will, above all, allow the Russian government to control its citizens even more. .
In the face of sanctions, Russia has been forced to seek rapid development of alternatives to the Swift global payments system, from which its banks were largely banned after the launch of the assault on Ukraine, while de-dollarizing their transactions.
Russia thus becomes the 21st country in the world to enter the testing phase to launch a digital currency, according to the Atlantic Council researchers, at a time when many states have begun to reflect on the issue. Only 11 others, including Nigeria, have already introduced a CBDC. Moscow hopes to extend the digital ruble to all Russians who want it “by 2025-2027,” according to the BCR’s response to AFP.
Source: BFM TV
