Behind this digital ruble

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Russia is paying the price for its war in Ukraine. One of the West’s first and most severe sanctions: the exclusion of the international payment network Swift. Since then, finance in the country has become complex. The local currency – the ruble – was largely unaffected by the measure.

To simplify payment processes and defuse the situation, Kremlin boss Vladimir Putin (70) is now pushing for rapid adoption of the digital ruble. The Russian cryptocurrency will be tested using a pilot project on Saturday, as the Russian central bank recently confirmed.

E-ruble can do it

“The testing phase will be conducted with real transactions and real customers, but only for a limited number of transactions and a limited number of customers,” Central Bank Governor Olga Skorobogatova said.

On Saturday, the central bank will launch the digital ruble along with 13 banks. Technical details are not known. It should be used for “transactions between individuals and payments in commerce and services,” according to central bank chief Skorobogatova.

Better control the population with cryptocurrency

While the ruble has been doing well so far thanks to interventions by the local central bank, Putin’s war economy and Western sanctions suggest that the ruble will continue to depreciate in the future. This increases the need for capital controls. A digital ruble is ideal for this.

The same goes for Russia’s efforts to control and manipulate its own population more closely. Unlike cash, thanks to cryptocurrencies, the government will be able to monitor all transactions in the future.

The digital ruble still has to survive the first stress test in April. If all goes as planned, Putin wants to launch the ruble nationwide in Russia from 2024 and make it usable abroad as well. It would become the second cryptocurrency in the international market after China’s E-Yuan.

Source :Blick