Russia Embraces Digital Ruble: President Putin Signs CBDC Law for Central Bank-Backed Currency

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Today, President Vladimir Putin of Russia officially signed the digital ruble bill into law, granting the country’s central bank the authority to issue its own digital currency. The digital ruble, a concept that the Bank of Russia has been carefully considering, will be integrated into the payment ecosystem alongside traditional methods, as outlined in the amendments to Russia’s Civil Code. The central bank will be responsible for overseeing the management of digital ruble accounts. After successfully passing its third and final hearing on July 11, the bill had been awaiting the President’s signature.

The idea of the digital ruble has been a work in progress at the Bank of Russia since 2020, when the institution released its initial analytical report on the subject. Over time, this report was updated with valuable input from Russian banks and other participants in the financial market. The regulator then proceeded to conduct pilot tests of the system with several Russian banks in February 2022, just before the nation became entangled in a conflict with Ukraine.

Given Russia’s current status under significant sanctions from the United States and Europe, the digital ruble could emerge as a potential tool to navigate the extensive financial restrictions imposed on the country by Western nations. Originally envisioned as a means to counter sanctions, the project was also designed to provide the government with greater oversight of fund allocation for social projects.

Anatoly Aksakov, the head of the parliament’s committee on financial markets, highlighted another significant benefit of the digital ruble. It would enable control and restrictions on how private citizens utilize their funds. For instance, parents could manage their children’s pocket money and have insight into their spending patterns. Aksakov shared these insights during an interview with Parlamentskaya Gazeta earlier in July.

Source: Cointelegraph

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