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The Central Bank of Russia is on track to pilot and launch its central bank digital currency, called the digital ruble, after President Vladimir Putin signed the Digital Ruble Law on July 24, 2023.
Starting August 1, the law introduces all but one of its regulations. The exemption, article number three, makes several changes 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 ruble’s digital infrastructure and the security of stored assets. Designed as a payment and money transfer mechanism, the digital ruble will not cater for investment purposes:
“With the help of the digital ruble it will be possible to make remote payments online in the same way as cashless payments, but the digital ruble can be used offline in the absence of the 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. The governor of the Bank of Russia, Elvira Nabiullina, confirmed the voluntary nature of the adoption of the digital ruble on July 24, expressing the hope that the new form of currency will be convenient and cost-effective for users:
“No one will force anyone into the digital ruble. It’s absolutely voluntary use, it’s an additional option for people: If they want – use it, if they want – don’t use it.”
Despite rapid progress on CBDC legislation, mass adoption of the digital ruble is not expected before 2025 or 2027, as Bank of Russia Deputy Governor Olga Skorobogatova stated:
“I think that all citizens will have the opportunity to open their wallets, receive digital rubles and use them in the horizon of 2025-2027.”
This comes after the country’s lower house of parliament, the State Duma, approved the digital ruble bill in its third reading on July 11, with the Federation Council approving the bill on July 19.