Bank of Russia to roll out CBDC Pilot in April 2023


TL;DR Breakdown

  • Bank of Russia set to roll a CBDC Pilot on April Fools Day 2023
  • The pilot will involve a total of 13 banks
  • The Bank of Japan will also launch its CBDC pilot in April

Russia will see a digitally memorable April Fools Day. On April 1, 2023, the Bank of Russia will launch the first consumer pilot for the nation’s central bank digital currency (CBDC). During a fintech conference in Russia, Skorobogatova informed reporters that the project would be introduced for peer-to-peer transactions between people and retail purchases.

The pilot will work on real operations for real people, but only for a limited number of them, with the 13 banks that have signaled they’re ready […] We plan to launch the digital ruble project on April 1, with transactions involving individual transfers as well as payments in trade and service enterprises

BOR deputy governor, Olga Skorobogatova

Russia puts in place real CBDC plans

Russia’s central bank initially proposed a CBDC initiative in October 2020 when it released a consultation paper discussing alternative digital ruble designs. In subsequent remarks, the bank stated that the project had the potential to reduce the Russian economy’s reliance on the U.S. dollar and lessen the effects of international sanctions imposed on the nation following its invasion of Ukraine.

Initially, it was anticipated that the pilot would go live in 2021. However, the Russian banking community has expressed worry that deploying infrastructure for the digital ruble will be costly for lenders and make the banking system less varied and controlled. As a result, the Bank of Russia subsequently pledged to alter the concept so that it does not harm the old system.

According to reports, the central bank will run a trial program for the CBDC with a select clientele. In addition, following the pilot, the Bank of Russia will determine how to extend the project.

According to an official source from TASS, the next CBDC pilot in Russia would feature genuine operations and real users. However, the number of transactions and consumers will be restricted. The bank’s deputy governor noted that the participating institutions have certified their technological preparedness to begin testing the digital ruble.

The deputy governor underlined that general clients would not be allowed to participate in the pilot program during its initial phase, as banks will only enroll select customers. After the initial test phase, the Bank of Russia intends to determine how to grow the digital ruble further, according to Skorobogatova.

Several Russian authorities have recently claimed that the Bank of Russia is considering a potential gold-backed token for international transactions. Vladimir Chistyukhin, the first deputy governor of the Bank of Russia, believes that such a “golden token” will assist Russia in developing a new investment product and a required payment method for international settlement.

Bank of Japan seat to pilot a CBDC in April

Aside from the central bank of Russia, the Bank of Japan is set to roll out its CBDC as well. Japan will launch a pilot program in April to explore the usage of a digital yen, the country’s central bank announced on Friday, joining a growing number of nations attempting to catch up to China in introducing a central bank digital currency (CBDC).

The widely anticipated action follows two years of studies conducted by the Bank of Japan (BOJ) to determine whether to issue a CBDC. It also precedes the anticipated leadership shift of the Bank of Japan from incumbent Haruhiko Kuroda to scholar Kazuo Ueda. 

The BOJ anticipates that the pilot initiative would result in better designs as a result of discussions with private enterprises. For example, alternative data models and architectures for offline payments are currently on the agenda, as is the optimal design of the CBDC system in offering value-added services. This is as well as difficulties and technologies or functionalities that may become necessary where a touchpoint with consumers occurs.

The executive director, Shinichi Uchida, of the central bank, stated:

Alongside this, our continued dialogue on CBDC and the future payments landscape thus far will enter a new phase. Continuing to draw on your experiences and insights, we are determined to design a CBDC that would be acceptable to both society at large and end users. 

Shinichi Uchida

The BOJ also intends to create a CBDC Forum. It will also welcome private companies involved in retail payments or associated technology to join. The bank will begin with narrowly defined objectives and gradually broaden its trials in a systematic and planned manner.

China is at the forefront of a worldwide race to build CBDCs and has accelerated trial schemes for retail payments. Japan, Russia, and other advanced nations are attempting to catch up with China.

The U.S. Federal Reserve has also considered launching a totally digital dollar, which some have dubbed Fedcoin. However, Fed authorities have stated that the support of elected leaders is necessary for the introduction of such an asset.

Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decision.

Florence Muchai

Florence Muchai

Florence is a crypto enthusiast and writer who loves to travel. As a digital nomad, she explores the transformative power of blockchain technology. Her writing reflects the limitless possibilities for humanity to connect and grow.

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