Russia has been having ongoing tests over the last several months. And judging by the bill's progress, I assume they think these tests have been going well. And they have moved yet one step closer to making their CBDC a reality. But how close are they?
Passing the bill
On the 11th of July the Russian Duma, the lower chamber of the Federal Assembly, passed the bill. It is not moved upstairs to the upper chamber of the Federal Assembly. And if it passes there then we are off to Putin to either sign it or tell them to get lost. But presumably, at that point it reaches Putin it is more of a formality. The bill itself is setting the guidelines for the ecosystem of the CBDC. As well as define legally what the “platform, ” participants,” and “users,” are. And The ecosystem then, I take it, is how they would be interacting with each other.
One of the Dumas chambers
Getting their own digital currency seems to quickly have become a priority for Russia. I would even guess it is in proportion to the sanctions from the West. Interestingly they have also relaxed their hard anty crypto legislation as the sanctions have gotten harder. And seeing how India recently has taken steps to tie other countries to its CBDC network. I would assume that Russia is looking to do the very same thing. As it would allow countries to buy Russian export using the Russian Rubel directly. Making the sanctions way less effective. It was a similar reason why Russia put rules in place after the sanctions that said if you want to buy Russian oil and gas you have to pay in Ruble. This was to strengthen the Russian Ruble and minimize the effect of the sanctions.
It will be interesting to follow and see if this indeed allows Russia to start trading more. As they primarily have been trading with other BRICS countries and a handful of others like Iran, Turkey and Pakistan. But maybe they think they can use India as a new trading hub to facilitate more trading partners for themselves. Something I think India would welcome as well. As that definitely would strengthen their own global position as well.
What do you think, will Russian trade increase with their own CBDC? Or are they simply getting it because their despot friends are getting it? Please share your thoughts in the comment section below.
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Picture provided by: Fair use