Russia’s central bank governor Elvira Nabiullina believes digital currencies will be the future of financial systems as the country’s economy becomes more online.

Elvira Nabiullina – Governor of the Central Bank of Russia

Moscow published as document advised on the feasibility of a digital ruble in October and intends to launch a digital central bank currency (CBDC) this year. Nabiullina believe The transition to CBDC will satisfy the need for a fast and inexpensive payment system in Russia.

The advisory document mentions the development of digital payments and access to the digital ruble as a cost reduction for payment services. In addition, money transfers are becoming cheaper and promoting healthy competition between financial institutions.

The aim is to initiate innovations in retail payments and to accelerate the emergence of the digital economy. The stability of the system as a whole should also increase, as users become less dependent on individual providers. Essentially, Russia wants to generate new energy and ideas for its economy in the form of CBDCs. Nabiullina said testing of the digital ruble could begin in 2022.

On the other hand, advocates of national digital currencies positive they can promote financial inclusion and facilitate cross-border transactions. However, Nabiullina believes there are certain hurdles before it can be done. How will they communicate with each other when each bank works in its own way?

“If each bank creates its own system, as well as the technology system, using local standards, it will be difficult to link those systems and allow all loans to be made; cross-border payments.”

Currently, cryptocurrencies in Russia cannot yet be used as a means of payment or owned by state officials.

The US is concerned about CBDC of some countries

Former Treasury Department official Michael Greenwald commented:

“What worries me is the possibility of Russia, China and Iran all creating central bank digital currencies that work outside of the dollar, and other countries to follow suit. Such a development would be alarming. “

Nabiullina admits that the US sanctions against Russia are a “permanent risk” and that the main reason for their fiscal policy is on the conservative side.

Washington has imposed a series of sanctions on Russia for its hacking problems and possible interference in the last two presidential elections.

As for China, it seems that the US is more concerned about being left behind as the digital yuan continues to grow rapidly. On June 2nd, China to explain will continue to test CBDC by giving away $ 6.2 million in digital yuan to people in Beijing in a lottery drawing. This is the third such experiment after both Chengdu and Shenzhen held lotteries last year.

There is also Source of information The United States is concerned about the success of these experiments, and the digital yuan in general will prop up China’s domestic economy. In addition, they fear that this could increase international competition and endanger the dominance of the US dollar.

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