The Bank of Russia has continued working towards the launch of a central bank digital currency (CBDC). The country plans to roll out the digital ruble to banks over the next few years.
Russia plans to launch digital ruble in 2024
The Bank of Russia released a monetary policy update revealing that the regulator planned to link all banks and other financial institutions to the digital ruble in 2024. The launch would mark an essential milestone for Russia, as on March 2024, the country will host its presidential elections.
By the CBDC launch, the Bank of Russia expected to have finalized trials for customer-to-customer and business-to-customer transactions via the digital ruble. In 2023, the central bank plans to beta test digital ruble smart contracts for trades. The beta phase will only be available to select participants.
The bank is also planning to go ahead with its CBDC plans gradually. It will launch new features and trials annually. After the Federal Treasury is ready, the digital ruble will support multiple payments, including consumer to government, business to government, and government to business.
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An offline mode for the CBDC will be launched by 2025 alongside the integration of the CBDC in non-banking financial intermediaries and other platforms offering financial and exchange services. The Bank of Russia also said that the phased process of having a digital ruble that will allow the market participants to adapt to new conditions.
The Bank of Russia will also work alongside the other central banks launching their CBDCs to ensure it can support cross-border payments and foreign exchange operations using digital currencies.
Russia’s CBDC plans
Russia launched the trial process for its CBDC in February this year. The announcement followed the release of the CBDC’s original roadmap in 2021. The Bank of Russia had previously required 12 banks to be involved in the trial phase for the digital ruble, including some of the largest banks in the country such as Sber, Tinkoff, VTB, among others.
Besides keeping up with the plans to launch the CBDC, Russia has also been lagging behind plans to regulate the private crypto sector. Russia’s president, Vladimir Putin, has advocated for changes to the country’s crypto regulations several times before. However, no major changes have been introduced regarding the country’s crypto mining and taxation sector.