With the intent of launching the Russian Central Bank Digital Currency (CBDC) or Digital Ruble in 2023, a senior lawmaker has revealed the country’s plans to use the CBDC for mutual settlement with China. Russia is taking this step in a bid to reduce the United States’ global financial hegemony with the dollar.
The CBDC is currently in the pilot phase of its development but is expected to have been completed by early 2023 for its beta testing.
The final reveal and connection of banks and credit institutions to the digital ruble network will be launched in 2024. Russia’s commitment to China has increased after several other nations turned their back on the country in the wake of its war with Ukraine.
Consequently, Russia was sanctioned by the United States Treasury Department, world-leading authorities, and many other entities. Financial service providers like MasterCard and Visa placed bans on conducting business with financial institutions of the war-ladened nation. Anatoly Aksakov, head of the finance committee in Russia’s lower house of parliament said,
“The topic of digital financial assets, the digital rouble and cryptocurrencies are currently intensifying in society, as Western countries are imposing sanctions and creating problems for bank transfers, including in international settlements.”
Russia Bypass Global Sanctions With Crypto
As there were suspicions that Russia was using cryptocurrencies to bypass sanctions, the European Commission also included digital assets on its sanction list.
Only last week, the U.S Treasury Department added 22 individuals and two Russia-based entities to the sanction list. Therefore, Russia is actively seeking alternatives for its global trading and payment methods.
In agreement with a recent announcement by the Prime Minister of the country Mikhail Vladimirovich Mishustin, crypto seems to be the best official payment method for imports and exports to ensure sustainable international trade.
PM Mishustin said he “would like to draw special attention to the importance of work to ensure the technological independence of the infrastructure and cybersecurity of financial institutions.
We need to intensively develop innovative areas, including the introduction of digital assets. This is a safe alternative for all parties, which can guarantee uninterrupted payment for the supply of goods from abroad and export.”