digital ruble test 2021
Cryptocurrencies,  Politics

Digital ruble testing by 2021, says Russian pol

The chairman of the Russian parliament’s financial markets committee called a central bank digital currency “the future of all our money circulation.”

Calling a digital ruble “the future of all our money circulation,” a member of Russia’s parliament with close ties to the central bank said yesterday that “a digital ruble will start being tested, possibly even in the next year,” according to Forbes.

Anatoly Aksatov, chairman of the Duma’s Committee on Financial Markets, also told the Blockchain Life conference on Oct. 21 that blockchain is the “technology of the future.”

Aksatov is also a member of the national financial council of the Central Bank of Russia (CBR). Last week, the CBR released a white paper on a digital ruble

“A digital ruble can make payments fast, simpler and safer,” the paper said. “The development of digital payments… will reduce the cost of payment services and remittances and promote competition among financial institutions.”

A digital ruble will be “absolutely equal” to a traditional ruble said the paper. The digital currency will be usable offline, it added. 

Beyond that, the digital ruble is seen as a shield against other central bank digital currencies, the paper noted. It will “mitigate the risk of reallocation of funds into foreign digital currencies, thus contributing to the macroeconomic and financial stability,” it said.

China is soon expected to make the digital yuan renminbi the first major CBDC to launch. However, the Central Bank of the Bahamas beat it to the punch on Oct. 21, launching the Sand Dollar.

No love for cryptocurrencies

While making clear that no final decision has been made on whether to launch the digital ruble, the CBR said it would be a central bank liability—a fiat currency—rather than a cryptocurrency.

The paper did not mince words regarding non-fiat cryptocurrencies.

“Cryptocurrencies are totally different from central bank money,” it said. “Cryptocurrencies do not have a single issuing authority; they do not guarantee a protection of consumer rights; their value is subject to significant volatility; it is illegal to use them to pay for goods and services in most countries; and they usually lack a single institution that would ensure their safety.

In an article on the CBR paper, The Moscow Times quoted the bank’s deputy governor, Alexey Zabotkin as saying “The existence of the digital ruble will curb the risks of using other, less reliable, payment solutions in the digital space.”

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Leo Jakobson, Modern Consensus editor-in-chief, is a New York-based journalist who has traveled the world writing about incentive travel. He has also covered consumer and employee engagement, small business, the East Coast side of the Internet boom and bust, and New York City crime, nightlife, and politics. Disclosure: Jakobson has put some 401k money into Grayscale Bitcoin Trust.