Digital Ruble Bill Approved in Russia, Setting the Stage for CBDC Implementation

By IndraStra Global News Team

Digital Ruble Bill Approved in Russia, Setting the Stage for CBDC Implementation

In response to stringent Western sanctions and escalating inflation due to the conflict in Ukraine, President Vladimir Putin of Russia has officially approved a bill that designates the "Digital Ruble" as an official form of currency. The bill, which advocates for the legalization of Russia's central bank digital currency (CBDC), gained the approval of both chambers of the nation's Parliament—the State Duma and the Federation Council.

This legislation confers the Bank of Russia, the nation's central bank, as the operational platform for the CBDC. Additionally, the bill establishes legal terms for users and outlines the operational guidelines for banks within the new framework. As per the legislation, Russian citizens can conduct payments and transfers using their digital wallets, which will either be hosted on the central bank's platform or on one of its affiliated banks' platforms. However, it's important to note that the central bank specifies that the CBDC is exclusively intended for payments and transfers and cannot be utilized for loans or deposits.

Despite receiving approval from Putin, Russian authorities anticipate that widespread adoption of the digital ruble will take several years. Olga Skorobogatova, the deputy chair of the central bank, mentioned in a Forbes interview that most citizens likely won't gain access to online wallets until at least 2025.

In contrast to cryptocurrencies like Bitcoin, a CBDC is a centralized token linked to a national fiat currency. Presently, Russia's ruble is ranked among the weakest global currencies due to increasing inflation, which was exacerbated by Western sanctions following Russia's military intervention in Ukraine last February.

The Russian ruble is trading at 90.6 rubles per USD and 100 rubles per Euro. Escalating inflation led the central bank to raise its interest rate to 8.50% just last week.

While the notion of a digital ruble has been discussed in Russia for some time, its urgency heightened after the United States and its allies imposed a series of sanctions to isolate Russia from international financial markets following the invasion. Legislative actions to expedite the introduction of the CBDC gained momentum earlier this year.

IndraStra Global Staff has not edited this story, which is auto-generated from a syndicated feed.

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IndraStra Global: Digital Ruble Bill Approved in Russia, Setting the Stage for CBDC Implementation
Digital Ruble Bill Approved in Russia, Setting the Stage for CBDC Implementation
By IndraStra Global News Team
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