Russia’s largest bank, Sberbank, carried out its first commercial transaction using blockchain. Sberbank, through its commercial and investment subsidiary, Sberbank CIB, announced the accomplishment on their website. Sberbank worked together with MTS, a leading Russian telecoms operator, and the National Settlement Depository (NSD) to complete the transaction.
Sberbank issued bonds worth RUB750 billion ($12 million) using smart contracts. The transaction was carried out on Hyperledger Fabric 1.1-based platform provided by NSD. According to reports, the bonds have a six-month maturity period. Sberbank CIB used blockchain technology to create a delivery and payment model before the transaction that facilitated instantaneous money and bond transactions.
The new technology in the banking industry will ensure secure transactions and proper management of the accounts. The three parties—Sberbank, MTS, and NSD—received access to the blockchain platform to perform the transaction. The new system allows individuals to exchange documents online and track the transaction status in real time. The new technology will also make work easier by handling the complex workload in a short time. The source code of the smart contracts is available to the public on Github.
Igor Bulantsev, senior VP of Sberbank and head of Sberbank CIB, said that accepting the use of blockchain technology will impact Russia’s economy for the better. In a statement, Bulantsev said the MTS bond issue demonstrated blockchain’s potential “to develop Russia’s digital economy, allowing Russian banks “to confirm the reliability, efficiency and secure nature of the blockchain platform and carry out complex structured transactions involving securities.”
Russia is making significant changes in their legislation to give room for more blockchain innovations. The State Dumas Committee for Legislative work in Russia supported a bill on Digital Financial Assets. The bill will protect Russian citizens from bankruptcy, fraud, and funding of terrorist groups according to Pavel Krasheninnokov, the head of the Legislative committee.
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