Russia plans to launch digital ruble to fight inflation and sanctions

by Jul 25, 2023CryptoNews0 comments

Russia is considering launching its own central bank digital currency (CBDC) to combat inflation and reduce its dependence on the US dollar, according to a report by Bloomberg.

The digital ruble, which could be issued as soon as 2023, would be a digital version of the national currency that would exist alongside cash and non-cash rubles. It would be controlled by the central bank and allow for faster and cheaper transactions.

The move comes as Russia faces rising inflation, which reached 7.4% in November, well above the central bank’s target of 4%. The digital ruble could help lower inflation by increasing the money supply and reducing the demand for cash, which is costly to print and distribute.

The digital ruble could also help Russia reduce its exposure to the US dollar, which accounts for about half of its international reserves and trade settlements. The US has imposed several sanctions on Russia over its annexation of Crimea, its interference in US elections, and its alleged involvement in cyberattacks.

By creating its own digital currency, Russia could bypass the US-dominated global payment system and foster closer ties with other countries that are developing their own CBDCs, such as China and the European Union.

However, the digital ruble also poses some challenges and risks for Russia. It could undermine the profitability and stability of the banking sector, which relies on deposits and fees from customers. It could also raise privacy and security concerns for users, who would have to trust the central bank with their personal and financial data.

See also  Robinhood to launch crypto trading in Europe in 2024 with FCA license

Moreover, the digital ruble could face competition from other cryptocurrencies, such as Bitcoin and Ethereum, which are popular among Russian investors and entrepreneurs. Unlike the digital ruble, these cryptocurrencies are decentralized and not controlled by any authority.

The central bank has said that it will conduct public consultations and pilot tests before launching the digital ruble. It has also assured that it will not replace cash or non-cash rubles, but rather complement them. The final decision on whether to issue the digital ruble will depend on the results of the experiments and the feedback from the public and stakeholders.

Recent News

Recent Posts

Disclaimer: The information provided on this website is for informational purposes only. We strive to ensure the accuracy and reliability of the content, but we make no representations or warranties of any kind, express or implied, regarding the completeness, accuracy, reliability, suitability, or availability of the information. The use of this website is solely at your own risk.
We do not endorse or promote any specific cryptocurrencies, projects, exchanges, or investments mentioned on this website. The inclusion of any external links does not imply endorsement or recommendation.
Please note that the cryptocurrency market is highly volatile and involves substantial risks. You should carefully consider your own financial situation and risk tolerance before engaging in any cryptocurrency-related activities.

Related Post


Submit a Comment

Your email address will not be published. Required fields are marked *