According to a Reuters report, Elvira Nabullina, the governor of Russia’s central banking, stated Tuesday that the country will have a prototype for its digital rouble platform by early 2022. She will then roll it out next year for testing before making a decision about whether or not it will release its own digital currency.
Russian lawmakers are reportedly working on legal modifications to the digital ruble plan in order to make it possible to accept the currency. According to Izvestia the head of the State Duma Committee on the Financial Market Anatoly Aksakov stated that legal modifications will begin once a trial of a central bank’s digital currency (CBDC), is completed.
For the digital ruble’s effective implementation, at least eight federal laws must be amended and five codes. These include the Civil Code (Tax Code), Budgetary Code, Criminal Code, and Administrative Code. According to the report, several issues will be addressed by the new rules, including the authority of the Central Bank of Russia (CBR), to create circulation for the new currency and its acceptance as a payment method.
According to the report, the trial will take place in multiple stages. The CBR will offer digital currency during the first stage. The network of pilot banks will grow in size, with 12 banks being the first.
According to reports, the CBR created a group to review its CBDC. Recent reports indicate that the reach of the banking system will expand even further.
Russia’s largest banks, including state-backed Sberbank, VTB and VTB, are among the participating banks. Tinkoff Bank is another powerful private bank that participates. Bank of Moscow, Transneftbank and Gazprombank are some of the banks that signed up for the pilot program to digital roubles.
In late 2020, the Bank of Russia revealed its CBDC strategy. The Association of Russian Banks criticised the project in January. They stated that any of the models proposed by the Bank of Russia could pose fraud and cybersecurity risks.
Many central banks around the globe are exploring the possibility of issuing CBDCs in response to increasing Bitcoin usage (BTC). These include, among others, the European Central Bank and People’s Bank of China.