A digital ruble coin is coming, but more legal framework needs to be hammered out first.
A Russian member of parliament who sits on the Central Bank’s National Banking Council gave the country’s blockchain aficionados some love on Wednesday, and even went so far as to say a digital ruble was coming.
“I always believed that a digital ruble is the future of all our money circulation,” says Anatoly Aksakov during the Blockchain Life conference held in Moscow yesterday. “Already we have begun consultations (on a digital ruble) and I think a digital ruble will start being tested, possibly even in the next year.”
Russian news media reports posit that a digital ruble is likely in late 2021. The currency would be used on blockchain systems and is a way for businesses to track goods across their supply chains, to prove country of origin, and track payments.
Just like cash and non-cash rubles, a digital ruble will perform all three functions of money: it will act as a means of payment, a measure of value, and a store of value. All three forms of the Russian ruble will be absolutely equal: one cash ruble equals one non-cash ruble, one digital ruble will always equals one cash ruble, the Russian Central Bank has said.
The Blockchain Life conference brought in around 3,000 participants, despite travel restrictions as result of Covid-19. It was not a virtual conference.
For Russia, the Blockchain Life forum has become one of the main events for many in the crypto and blockchain space, like a miniature Blockchain Week that is held in New York in the spring.
Anatoly Aksakov of the National Banking Council of Russia. "Blockchain is the future", he says. But ... [+]
Aksakov reiterated Russia’s official position on blockchain — calling it the “technology of the future”. But said cryptocurrency is another matter.
“There are currently two equal positions on cryptocurrencies. The main opposition to cryptocurrencies is coming from the high-risk it poses for financial institutions, ordinary people. This side is trying to foresee all the risks involved and possible reactions to them.”
Russia has more than 6 million users of cryptocurrencies, according to data from Cambridge University. The total has doubled in recent years.
“It is great to see that the authorities are in constant dialogue with representatives of the crypto industry, and there are no opponents of blockchain in the government,” says Sergei Khitrov, CEO of Blockchain Life.
Russia developed a new version of cryptocurrency regulations that will come into force on January 1st, 2021. According to the new rules, people can trade digital financial assets within Russia, but are not allowed to pay for goods and services with crypto currency.
“In my opinion, the law allows for many things within the Russian regulatory environment,” says Aksakov, adding that “many very serious businessmen are already preparing to launch their digital financial assets.”
To many in the Russian crypto world, this is confusing. You can trade Bitcoin and other coins, but you can’t buy anything legally with them.
“The law equates forbids using (cryptocurrency) when paying for goods and services in Russia. Perhaps, in the future, bylaws can even out this contradiction,” says Nikita Zuborev, head of PR and marketing at BestChange.com, a Russian web-service helping find the best rates at e-currency exchanges. “At the moment, the legal status of the digital ruble is unclear.”
Blockchain, meanwhile, has more tacit support from on-high in Moscow.
The technology is being actively implemented in some private transactions relations such as in logistics, insurance, and other businesses.
“So far, as we can see from the statements of politicians, that opinions are divided,” Max Krupyshev, CEO of CoinsPaid.com, a crypto-financial ecosystem including a cryptocurrency wallet, payment processor, exchange with an OTC desk, and a hot wallet system for businesses. “Some are skeptical while others see new opportunities in Russia. We need to understand why a crypto ruble is being created – to support some kind of financial patriotism...or to compete with Bitcoin and other cryptocurrencies? The idea is in the public eye, but I think it's too early to see where this is going,” says Krupyshev.
