CBDC

Russia's Central Bank plans to issue "digital currency" with legal tender status and fiat attributes.

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Russia

The Central Bank of Russia recently stated that although they are exploring the feasibility of issuing a Central Bank Digital Currency (CBDC), it is still a long way from being officially launched.

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CBDC Central Bank Digital Currency, CBDC is a digital fiat currency issued by the Central Bank of Russia, which has the attributes of legal tender and the government-supported status of legal currency, thus distinguishing it from cryptocurrencies that have not yet been legislatively recognized.

This is not the first time the Russian government has considered issuing a digital currency. On April 18th of this year, the country published a policy brief on central bank digital currency, emphasizing in the brief that digital fiat currency cannot provide the same level of anonymity as cash. Additionally, the current population is still accustomed to using cash, and digital currency cannot yet replace cash in low liquidity situations.

The head of the country's central bank, Elvira Nabiullina, stated on June 14th at a meeting that the immediate implementation of digital currency is not feasible, but central banks, including Russia, are exploring the feasibility of practical implementation. She expressed:

What we are talking about is a national currency that operates domestically, and it must ensure that there are reliable and mature technologies, such as distributed ledger technology, which are the basic models for many countries to develop digital currencies.

According to a report, the World Economic Forum released a report this year claiming that at least 40 central banks globally are studying digital currencies. A research report from the Bank for International Settlements also indicates that 70% of central banks worldwide are researching the introduction of digital currencies.

Nabiullina further raised a broader question:

Is the country ready to enter a cashless era? While some jurisdictions have significantly reduced cash usage, others still heavily rely on cash.

It was also reported last month that Nabiullina mentioned on May 23rd that the central bank would consider using gold-backed cryptocurrencies to facilitate international settlements.

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