Russia’s Digital Ruble Bill Approved by State Duma
Summary: The digital ruble, a central bank digital currency initiative in Russia, has been approved by the State Duma and will be considered by the Federation Council and finally the president if approved. The bill defines "platform," "participants," and "users" under the law and lays out broad principles for the CBDC ecosystem. The Bank of Russia will manage the technical underpinnings of the digital ruble.
The digital ruble, a central bank digital currency (CBDC) initiative in Russia, has advanced. The digital ruble bill was approved on the third reading in the State Duma, the lower house of the Federal Assembly of the Russian Federation, on July 11. The bill will next be considered by the Federation Council, the assembly’s upper house, and then, if approved there, by the president.
Bank of Russia Playing Pivotal Role
The measure, which was most recently revised at the end of June, defines “platform,” “participants,” and “users” under the law and lays out broad principles for the CBDC ecosystem.
Under the present plan, the Bank of Russia, the country’s central bank, would play a pivotal role in managing the technical underpinnings of the digital ruble. All assets in storage are also its responsibility.
No Charge for Individuals
The Bank of Russia claims that making payments and transferring funds is the primary function of CBDC. Users will be unable to set up savings accounts because of this. The central bank stresses that individuals would not be charged for making or receiving payments or transfers, whereas businesses would be charged 0.3% of the value of each payment or transfer.
Potential Dangers Warned
The legislation was first proposed to the State Duma in December 2022 and eventually approved after a single reading in March 2023. Gazprombank, a division of Russia’s largest state-owned gas corporation, issued a cautionary statement to banks in February, highlighting potential dangers associated with the rapid adoption of digital currency.
According to McKinsey Russia’s estimate, conventional banks might lose over $250 billion rubles ($3.5 billion) over the course of five years should CBDC be implemented. Meanwhile, the advisory group predicted an annual profit of $1.1 billion for retailers.
Pilot Test This Year
The digital ruble will be made available to all Russian residents by 2027, as stated by Olga Skorobogatova, deputy chairperson of the central bank, in a recent interview. Between 2023 and 2024, the CBDC will be piloted.
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