The Russian Central Bank has announced that it has begun testing its digital ruble project, which will be introduced with new features starting in 2023. However, the stance towards cryptocurrencies in Russia still remains questionable given that only just recently a presidential ban on crypto transactions came into effect.
According to a document published by the Bank of Russia, the digital ruble will be used as a real means of payment between individuals and businesses by 2023. In 2024, the project could make it possible that credit institutions can connect to the digital ruble platform and increase the number of available payment options as well as transactions using smart contracts.
Cautious rollout of a digital ruble
The central bank wants to approach the rollout carefully to avoid missing any important details. Their main goal is to make the digital central bank currency (CBDC) useful for individuals, businesses and the government. Noting that the gradual process of introducing the digital ruble will allow market participants to adapt to the new conditions.
In addition, the Bank of Russia hopes to expand the use of the digital ruble beyond the country. It plans to work with partnering central banks so that the digital ruble can facilitate international transactions. They also hope for non-bank financial companies and exchanges to get involved in 2025 with different integrations.
Worldwide acceleration of CBDC efforts
While Russia plans a gradual release of its digital ruble, other countries have also made steady progress on their central bank digital currency projects. South Korea began testing its national digital currency in July. According to local media reports, the central bank has invited several commercial banks operating in the country to participate in the testing. Thailand also recently began a trial of a CBDC project. And China has been moving forward with their projects in the CBDC space as well.
The only exception to this growing consensus around central bank digital currencies (CBDCs) seems to be Japan. The Japanese central bank had been testing the technical viability of a digital yuan since 2021 and has recently put it on hold during the second phase of the experiment. The Bank of Japan simply didn’t see enough demand for a central bank issued digital currency.