Russia’s central bank recently said that it is looking to begin a pilot for the digital ruble next year, with plans to use the central bank digital currency (CBDC) for international payments.
Digital Ruble a Priority, Says Central Bank Governor
According to a Reuters report, the governor of the Bank of Russia, Elvira Nabiullina, speaking to the Lower House of Parliament, asserted that the central bank is preparing to start “real-world digital ruble transactions” in 2023.
Nabiullina also said:
“The digital rouble is among the priority projects. We have fairly quickly created a prototype … now we are holding tests with banks and next year we will gradually have pilot transactions.”
Russia has been working towards developing a CBDC for more than a year. The central bank launched a prototype of the digital ruble platform in December 2021, with 12 commercial banks signaling interest in participating in the pilot program.
Three out of the 12 banks connected to the platform, with two completing digital ruble transfers between clients via mobile banking applications in February 2022.
Apart from the digital ruble project, Nabiullina said Russia is looking at expanding the number of countries that accept the organization’s MIR banking cards. MIR is a local alternative payment system to Visa and Mastercard, with both companies having suspended operations in Russia after the Ukraine invasion.
Binance Restricts Services in Russia After EU Sanctions
Meanwhile, the latest development comes as Russia is being slammed with various economic sanctions. In the early days of the invasion of Ukraine, there were calls for cryptocurrency exchanges to stop servicing Russian users, but quite a few refused at first.
The United States has also kept an eye on Russia to see if the country would use crypto to circumvent financial sanctions. In March, the U.S. Deputy Secretary of the Treasury, Wally Adeyemo, and Christine Lagarde, President of the European Central Bank, warned exchanges against aiding Russia to avoid sanctions.
Recently, Binance announced that it will limit its services in Russia, in line with European Union (EU) new sanctions. According to the cryptocurrency exchange giant, the platform will only service “Russian nationals or natural persons residing in Russia, or legal entities established in Russia, that have crypto assets exceeding the value of 10,000 EUR.”