Ukraine's National Bank Joins The Concept Of Digital Currency, E-hryvnia

The National Bank of Ukraine (NBU) has introduced the concept of draft e-hryvnia. (photo: dock. Pixabay)

JAKARTA - The National Bank of Ukraine (NBU) has introduced a draft concept for digital bank (CBDC) digitalcurrency candidates hryvnia, or called e-hryvnia.

Ukraine's central bank on November 28 issued a statement about the concept of e-hryvnia, which aims to perform all its cash functions by adding cash and non-cash form from hryvnia as its main target.

NBU said it had presented the concept of e-hryvnia and continues to develop the CBDC project with participants in the virtual asset market, payment companies, and state bodies.

According to the announcement, the central bank is currently considering and developing three possible CBDC options, depending on design and key characteristics.

The first option explains e-hryvnia for cashless payments with the possibility of "programd" money functionality through smart contracts. The retail e-hryvnia will enable the implementation of targeted social payments and reduction of government spending for administration, "said NBU, quoted by Cointelegraph.

The second CBDC option envisions e-hryvnia being available for use in operations related to cryptocurrency exchange, issuance, and other virtual asset operations. E-hryvnia can be one of the key elements of the development of quality infrastructure for the virtual asset market in Ukraine,the announcement note.

The third option includes e-hryvnia to allow cross-border payments to provide global transactions that are faster, cheaper, and more transparent.

The development and application of e-hryvnia could be the next step in the evolution of Ukraine's payment infrastructure, said Oleksii Shaban, Director of NBU Payment Systems and innovative development departments, in his statement. He added that the CBDC of Ukraine could have a positive impact on ensuring economic security and strengthening the country's monetary sovereignty, as well as sustainable economic growth.

According to the announcement, Ukraine's Intellectual Property Institute registered the "e-hryvnia" trademark for NBU in October 2022.

As previously reported, NBU has been actively studying the possibility of publishing CBDCs in recent years, hiring blockchain developers and collaborating with large industrial projects such as the Stellar Development Foundation.

According to regulators, NBU has launched a pilot project to issue e-hryvnia for blockchain-based retail payments by 2018.