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Ukraine has been ramping up its efforts to roll out a central bank digital currency (CBDC) and in its latest move, the government has revealed that it’s weighing a CBDC pilot for salary payments. The pilot would be conducted at the Ministry of Digital Transformation and comes just three weeks after the Ukrainian president signed into law a bill that allows the central bank to issue a digital currency.

The newest development was revealed by Mikhail Fedorov, the Ukrainian Minister for Digital Transformation and also its Deputy Prime Minister. In an interview with Ukrainian outlet TSN, Fedorov said that his ministry was considering rolling out a pilot test in which it would pay its staffers in the digital hryvnia.

“Frankly as one of the first pilots, we have on the table the question of paying salaries to employees of the Ministry of Digital Transformation in electronic hryvnia,” the minister stated.

In his interview, the minister made a case for rolling out the CBDC in a small controlled pilot as opposed to a wider rollout for the public. At this stage, the Ukrainian government has no way of predicting how the CBDC could affect the financial, economic and regulatory environments. As such, focusing on ministry staffers gives them the best way to get started with the testing phase, he argued.

The minister is confident that adoption of the CBDC will be seamless. “Ukrainians rank first in the world in terms of adaptability to virtual assets,” he pointed out. Data from Chainalysis supports the minister. The 2021 Global Crypto Adoption Index report by the blockchain analytics company published on August 18 puts Ukraine at fourth globally in adoption, after Vietnam, India and Pakistan. Last year, the country ranked first globally for digital currency adoption.

“This openness to technology can be one of Ukraine’s main advantages which can attract additional investments to the country and its businesses,” the minister added.

There have been reports that the Ukrainian government could use the CBDC in the payment of social benefits and government subsidies. However, the minister believes that the government needs to first test the technology before going on to such use cases.

To learn more about central bank digital currencies and some of the design decisions that need to be considered when creating and launching it, read nChain’s CBDC playbook.

Watch: CoinGeek Zurich panel, Digital Technology and the Future of Banking & Financial Services

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