A group of Russian legislators, headed by Anatoly Aksakov, Chairman of the Financial Market Committee, have proposed draft legislation to create the digital Ruble that the Bank of Russia will issue. The bill outlines the necessary changes to establish the conditions for introducing the central bank-backed currency (CBDC).
The proposed draft legislation
According to reports, the main goal of the digital currency law is to create a payment system that would allow Russian individuals, businesses, and the government to conduct rapid, easy, and economical monetary transactions. Legislators believe this will boost financial accessibility and effectiveness for everyone.
By adding definitions, the digital Ruble bill seeks to amend numerous laws. The proposed amendments would give the Bank of Russia sole control over the CBDC platform. Additionally, the legislation describes how to use the network and establish a wallet.
The law has also been amended to recognize the virtual currency as the official currency of the Russian Federation and to classify central bank digital currencies created by other nations as International currency. Subsequently, it makes it easier to establish the digital Ruble’s legal standing within Russia’s financial system.
The Federal legislation “On Personal Data” has been amended to let the central bank of Russia process personal data without requesting permission and without informing the Russian agency in charge of preserving individual data rights beforehand. The move signals a paradigm shift in how personal information is handled in Russia.
The digital Ruble
The Russian Central Bank revealed its idea for a Digital coin in October 2020. In December 2021, it finished building the framework for its prototype. The project’s initial phase began in January of the same year. In May, the central bank stated that it intends to start testing involving genuine transactions and users in April 2023.
In reaction to increased Western sanctions connected to Russia’s invasion of Ukraine, the Central Bank of Russia said in June that it was shortening the timescale for its E-currency project, with a complete launch date of 2024. More than a dozen Russian financial institutions are now participating in the trials.