• Tue. Feb 27th, 2024

Russian signs CBDC law; Implementation is expected by 2024

Russian signs CBDC law;  Implementation is expected by 2024

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Following the signing of the Digital Ruble Bill by President Vladimir Putin on July 24, 2023, the Central Bank of Russia is preparing to pilot and launch its own central bank digital currency known as the Digital Ruble.

Effective August 1, the law introduces all but one of its restrictions. The waiver, Article Number Three, makes several amendments to federal laws, including those related to bankruptcy and inheritance, and is scheduled to be activated in August 2024.

Under the new legislation, the Russian Central Bank will oversee the operation of the digital ruble infrastructure and the security of stored assets. Designed as a payment and money transfer mechanism, the digital ruble is not suitable for investment purposes:

“With the help of digital ruble remote payments can be made online like cashless payments, but digital ruble can be used offline in the absence of internet.”

Russian citizens have the choice to use the digital ruble, which will act as a third form of money alongside cash and cashless rubles. Elvira Nabiullina, governor of the Bank of Russia, on July 24 confirmed the voluntary nature of the adoption of the digital ruble, expressing hope that the new form of currency will prove convenient and cost-effective for users:

“No one is going to force anyone into the digital ruble. It is a completely voluntary use, it is an additional opportunity for people: if they want – use, if they want – do not use.

Despite rapid progress on CBDC legislation, mass adoption of the digital ruble is not expected before 2025 or 2027, Bank of Russia Deputy Governor Olga Skorobogatova stated:

“I think that all citizens will have the opportunity to open wallets, receive digital rubles and use them in the horizon of 2025-2027.”

This comes after the State Duma, the lower house of the country’s parliament, passed the digital ruble bill in its third reading on July 11, and the Federation Council approved the bill on July 19.

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