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Russia's State Duma Approves Digital Ruble Bill: A Step Toward Central Bank Digital Currency

Russia’s State Duma Approves Digital Ruble Bill: A Step Toward Central Bank Digital Currency

The State Duma, the lower chamber of the Russian Federal Assembly, has recently approved the digital ruble bill in its third reading. This landmark decision paves the way for the creation of Russia’s Central Bank Digital Currency (CBDC). The bill will now proceed to the Federation Council and eventually to the President’s Desk for potential approval.

Approval of the Digital Ruble Bill by the State Duma

The digital ruble bill, introduced in December 2022, has successfully cleared its initial readings and undergone several amendments. Most recently, in late June, the bill was approved in its third reading by the State Duma. This approval signifies a significant step toward the implementation of Russia’s CBDC.

Key Points of the Digital Ruble Bill

The digital ruble bill includes crucial definitions for terms such as “platform,” “participants,” and “users.” These definitions lay the foundation for the legal framework surrounding the CBDC ecosystem. Additionally, the bill provides general guidelines and principles for the operation and utilization of the digital ruble.

Role of the Bank of Russia in the Digital Ruble Infrastructure

The Bank of Russia (BoR), as Russia’s central bank, will play a primary role in the operation of the digital ruble infrastructure. The BoR will serve as the operator and custodian of the digital ruble system, responsible for safeguarding all the assets stored within it. This role ensures the security and stability of the CBDC.

Objectives of the Central Bank Digital Currency (CBDC)

The primary objective of the digital ruble, as highlighted by the Bank of Russia, is to facilitate seamless payment and transfer methods. The CBDC aims to enhance the efficiency and accessibility of financial transactions within Russia. It is worth noting that individuals using the digital ruble will not have the option to open saving accounts. Individual customers will enjoy free payment and transfer services, while corporate clients will be subject to a fee of 0.3% of the payment amount.

Transition and Adoption of the Digital Ruble

To ensure a smooth transition and widespread adoption, Olga Skorobogatova, the deputy chairman of the central bank, revealed plans for a pilot program. This pilot program will be conducted between 2023 and 2024 to test the functionality and effectiveness of the digital ruble. The central bank aims to achieve the widespread adoption of the digital ruble by all Russian citizens by 2027.

Conclusion

The approval of the digital ruble bill by the State Duma represents a significant milestone in the journey toward establishing Russia’s Central Bank Digital Currency. The bill’s provisions and guidelines set the stage for the development of the digital ruble ecosystem, with the Bank of Russia assuming a key role. The digital ruble aims to streamline payment and transfer methods, promoting efficiency and accessibility in financial transactions within Russia.

FAQs

Q1: What is the digital ruble bill? The digital ruble bill is a legislative initiative that aims to create Russia’s Central Bank Digital Currency (CBDC), known as the digital ruble.

Q2: What role will the Bank of Russia play in the digital ruble infrastructure? The Bank of Russia will serve as the primary operator and custodian of the digital ruble system, responsible for managing and safeguarding the assets stored within it.

Q3: What are the objectives of the digital ruble? The digital ruble aims to facilitate seamless payment and transfer methods, enhancing the efficiency and accessibility of financial transactions within Russia.

Q4: Will individuals be able to open saving accounts with the digital ruble? No, individuals utilizing the digital ruble will not have the option to open saving accounts. The focus is on providing free payment and transfer services to individual customers.

Q5: What are the plans for the adoption of the digital ruble? A pilot program will be conducted between 2023 and 2024 to test the functionality and effectiveness of the digital ruble. The goal is to achieve widespread adoption among all Russian citizens by 2027.

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