Russia appears to be making progress with regard to its digital Ruble plans, as evidenced in recent reports. The transcontinental country has had good reasons to turn to digital assets, considering Western sanctions. Russia has softened its legislation despite not being completely welcoming to all digital assets and digital asset mining.
The highlight of its interest in digital assets is the country’s CBDC plan for a digital Ruble launch. Now, a recent document suggests that the Central Bank of Russia (CBR) will commence rollouts across banking institutions in 2024.
Following several greenlights of an imminent digital Ruble initiative, Russia recently revealed a tentative rollout period across banks. On August 11, Russia released its “Main Directions for the Unified State Monetary Policy.” The document highlighted policies for 2023, and the periods of 2024 and 2025.
The Monetary Policy would address measures necessary to adjust the country’s economy and financial approach. This is especially important due to the sanctions imposed by the West due to its invasion of Ukraine.
According to the document, the Bank of Russia will gradually connect banking institutions to the digital Ruble platform in 2024. The CBR will, in turn, increase the number of payment options. It also plans to collaborate with central banks of other countries that have established CBDCs. This should facilitate cross-border and FX transactions between Russia and the countries using these digital currencies.
Subsequently, Russia’s central bank is looking to launch an offline mode for the digital Ruble in 2025. In addition to this, the bank will connect non-bank financial intermediaries. It will also integrate other financial apps and exchanges with the payment system of the CBDC during this period.
The CBR plans to pilot the digital Ruble in 2023
Russia appears to be implementing several stages of the digital Ruble in successive phases. The central bank noted that this is necessary to allow market participants to get used to the new conditions of the digital currency. Currently, the digital Ruble initiative is in the testing phase.
The Bank of Russia is looking to start facilitating settlements in the digital Ruble in 2023, marking the project’s pilot phase. These initial settlements will be between individuals and enterprises. Additionally, a few selected participants will have the opportunity to execute smart contract transactions on the digital Ruble platform. This will also take place next year.
This supports the central bank’s comments in April on launching the pilot phase of the digital Ruble next year. With its financial sector taken off the SWIFT payment system and restrictions from Visa and MasterCard, Russia’s digital Ruble initiative is of utmost significance. In June, CBR Governor Elvira Nabiullina announced support for using digital assets for international settlements.
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