After Banning Crypto, Russia Immediately Trials The Digital Ruble

JAKARTA – Russia is preparing a digital ruble. A number of banks in Russia are also reported to have tested transactions using the digital currency. Trials have been carried out for customer-to-customer (C2C) payments. Russia's central bank is preparing to expand this digital ruble transaction.

In this case, Russia is following in the footsteps of China, which launched Yuan Digital last year. Despite recently banning cryptocurrencies, Russia has said it will not act as harshly on crypto mining as China does.

Reporting from Bitcoin.com News, the Central Bank of Russia (CBR) completed a prototype of the digital ruble platform in December and is now starting to experiment with transactions. There are 12 banks that have been invited to join in the first phase of the pilot phase of the project. The monetary authority is gradually expanding the range of participants to include financial service providers and other types of transactions.

Currently, most Russian banks are preparing to pilot a new central bank digital currency (CBDC), Tass reported after contacting the institution. One of them, Promsvyazbank (PSB), is currently processing C2C payments, Maxim Khrustalev, an adviser to the bank's deputy chairman told the news agency.

After the customer-to-customer transaction, “the technical testing of C2B, B2C and B2B payments will begin. Based on the test results, the Bank of Russia will start introducing the digital ruble platform into commercial operations," Khrustalev said.

Tinkoff Bank has also joined efforts to pilot a new digital form of Russian fiat. “Tinkoff is preparing to test the digital ruble in the near future,” according to a statement from neobank online. Tinkoff recently entered the crypto space by acquiring a controlling stake in Swiss-listed fintech startup Aximetria.

Another major Russian bank, VTB, said its infrastructure was ready to test the digital ruble. “Pioneering includes integration with the digital ruble platform and the introduction of services such as opening a wallet via a mobile app and digital ruble transfers between individuals,” the bank's press office detailed.

According to Vitaly Kopysov, chief innovation officer at SKB-Bank, the digital ruble will be a driver for the development of new national payment services for citizens and companies. Talking to Tass, he explained:

“The digital ruble will provide an additional impetus to the creation of offline cashless payment services for businesses without Internet access at the point of sale, which is especially important given the geography of the Russian Federation.”

Russia's central bank has maintained a hard-line stance on cryptocurrencies and recently proposed a broad ban on crypto-related activities. This prompted the emergence of the digital ruble three years ago and decided to explore options for issuing a CBDC in 2020, when it publishes a consulting paper on the matter. In April 2021, the bank released a digital ruble concept outlining its main architecture.

Other banks participating in the first phase of the trial are Ak Bars, Alfa-Bank, Dom.rf Bank, Gazprombank, Rosbank, Sberbank, Soyuz Bank, and Transcapitalbank. The Federal Treasury, along with financial intermediaries, will join in the second phase when transactions between private individuals and corporate entities will be conducted, including consumer-to-business (С2B), business-to-business (B2B), and business-to-government ( B2G).