Despite Russia’s continued hostility on Ukraine, the country is pressing forward with the development of its electronic hryvnia, or e-hryvnia.
On Monday of this week, the National Bank of Ukraine (NBU) presented a draft proposal for the central bank digital currency (CBDC) that would be used in the country. According to the statement, the primary objective of the e-hryvnia is to fulfill all of the tasks normally associated with money by acting as a complement to both the cash and non-cash versions of the hryvnia.
During the discussion with the representatives of banks, non-banking financial institutions, and the virtual asset market, the National Bank presented the possible design of the e-hryvnia, as well as its architecture, characteristics, and advantages for payment service providers, it said. The discussion was led by the Virtual Asset Market.
Among them are the prospective possibilities for the utilization of the bank’s CBDC, which have been offered by the bank and are presently the subject of discussion and development. These include:
e-hryvnia for retail non-cash payments with the possible functionality of “programmed” money: for the implementation of social payments, the reduction of government expenditures on administration and control of the use of funds, and the use of the smart contract technology for programming calculation logic depending on the circumstances and facts; e-hryvnia for retail non-cash payments with the possible functionality of “programmed” money; e-hryvnia for retail non-cash
e-hryvnia for use in fields related to virtual assets; this includes exchanges and provisions of issuance; e-hryvnia to enable cross-border payments; these payments would be faster, cheaper, and more transparent. e-hryvnia for use in fields related to virtual assets; this includes exchanges and provisions of issuance.
The bank’s main point of contention, with reference to cryptoassets in particular, was that,
E-hryvnia has the potential to become one of the key aspects of key elements of key factors in the development of quality infrastructure for the virtual assets market in Ukraine.
Additionally, the bank noted that,
“In particular, the utilization of a technological platform for instant e-hryvnia payments, service programming, and data flow analysis will create ample opportunities for the emergence of new business cases, the digitalization of services, the attraction of new customers, cost optimization, and other such things.”
“The next phase in the evolutionary process”
The initiative was kicked off in September of last year, with the intention of evaluating whether or not it would be possible to issue digital hryvnias on a broad scale inside the nation. According to the statement, when formulating the idea for the concept, the regulatory body took into consideration both its own research as well as the findings of a survey of financial market experts regarding the demand for the e-hryvnia that was carried out by the National Bank in 2021. Additionally, it took into consideration the experiences of other nations that had developed CBDC.
Oleksiy Shaban, Deputy Chairman of the National Bank, was reported as stating that the creation and implementation of this CBDC may be “the next stage in the evolution of the payment infrastructure of Ukraine.” In addition, it would contribute to the following things:
the digitization of the economy, the further development of cashless payments, the lowering of expenses, the rise in the degree of transparency, and the overall increase in faith in the national currency.
Shaban was of the opinion that all of this could have a positive effect on the economic security and monetary sovereignty of the country, in addition to the ability of the National Bank to maintain price and financial stability as a guarantee of sustainable economic growth. He expressed these opinions based on his opinion that all of this could have a positive effect.
According to the bank,
“The use of e-hryvnia should be easy and accessible to all sectors of the public, legal entities, state bodies, banks, and non-bank financial organizations,” is a phrase that may be translated to “the use of electronic hryvnia should be.”
According to the report’s conclusion, the bank will proceed with the development of the e-hryvnia concept project in collaboration with players of the payment market, participants of the virtual assets market, and governmental entities.
In the meanwhile, it was revealed yesterday that India is also making progress with its CBDC operations. According to a statement released by the nation’s federal Reserve Bank on Tuesday, the nation will conduct the first pilot for retail digital currency on December 1. In the first phase of the pilot, which will take place in four locations throughout India (Mumbai, New Delhi, Bengaluru, and Bhubaneswar), there will be participation from four local banks: State Bank of India, ICICI Bank, Yes Bank, and IDFC. According to the report, Bank of Baroda, Union Bank of India, HDFC Bank, and Kotak Mahindra Bank would eventually participate in the trial program.
The Japanese government’s central bank is apparently planning to launch a trial involving “consumers and private sector enterprises” in the spring of 2023. This might mark the beginning of the digital yen pilot program in the country.
And Mainland As the People’s Bank of China (PBoC)-led initiative moves closer to deployment, China and Hong Kong are getting ready to jointly launch the first cross-border pilot project for the digital yuan.
Compiled by Coinbold