The Central Bank of the Russian Federation (CBR) and other financial institutions have begun testing the digitalized national fiat currency, called ‘Digital Ruble.’ The testing for central bank digital currency (CBDC) began in December 2021, when a prototype of the digital ruble platform was created. 
<h2>Digital Ruble Transaction Executed by CBR and Other Banks</h2>
The <a href="https://www.cryptoknowmics.com/news/central-bank-of-russia-cbr-shuts-doors-to-bitcoin-etf-trading-elvira-nabiullina-tells-media/">Bank of Russia</a> announced that the pilot stage of the digital ruble, the intended central bank digital currency, has begun. According to the regulator, it has the potential to become an alternative to cryptocurrencies for Russians, which should be completely prohibited.

According to an announcement published on the Russian Central Bank’s website on Tuesday, 3 banks have already been facilitating trial transactions for their clients using existing mobile banking applications, as well as gateways to exchange rubles from their account to a digital version. 

Russian Central Bank additionally states that 12 banks are upgrading their tech stacks to participate in the pilot and 2 banks have completed a full cycle of <a href="https://www.cryptoknowmics.com/news/digital-ruble-will-be-available-to-foreigners-in-russia/">digital ruble</a> transfers between clients using mobile banking apps. 

According to the CBR, users were able to establish digital ruble wallets using the applications, swap ordinary electronic money from their bank accounts for digital rubles, and then move the currencies amongst themselves.

In addition, there are also plans of adopting the offline payment method and completing transactions with non-resident users as well. 
<h2>Foundation of the Digital Ruble</h2>
The digital ruble operates on a two-tiered system. Central Russian Bank is the platform's issuer and operator, while the end-users gain access through intermediaries. Users can create wallets and perform transactions using any bank's mobile app. <a href="https://www.cryptoknowmics.com/news/russians-divided-on-cbdc-few-would-accept-salaries-in-digital-ruble/">Olga Skorobogatova</a>, the CBR's First Deputy Chairman, was cited as saying:
<blockquote>“The digital ruble platform is a new opportunity for citizens, businesses, and the state.”</blockquote>
On Tuesday, the CBR Governor <a href="https://www.cbr.ru/eng/about_br/nabiullinaes/">Elvira Nabiullina</a> met with the Finance Minister Anton Siluanov and Deputy Prime Minister Dmitry Grigorenko to reach an agreement. However, the CBR and the finance ministry are yet to reach an agreement on the views of digital assets and the regulation of cryptocurrencies.

Earlier this year, the former recommended a complete ban on all cryptocurrency endeavors. The CBR alleged that such assets were reminiscent of a pyramid scheme and constituted a danger to the local monetary system.

The Bank of Russia claimed that cryptocurrencies are a threat to the financial stability of the economy and rife with fraud. Thereby, they banned cryptocurrency trading and mining in the country. 

The Russian Ministry of Finance, on the other hand, proposed the advantageous benefits of creating and imposing a regulatory framework. Olga Skorobogatova, Deputy Chairman of the Bank of Russia, stated in a publicly published notice,
<blockquote>“We plan that, for citizens, transfers in Digital Rubles will be free and available in any region of the country, and for businesses, this will reduce costs and create opportunities for the development of innovative products and services.”</blockquote>
Unlike total prohibition as proposed by CBR, institutions in Moscow, including the federal government and finance ministry have decided that a more appropriate approach to the crypto space would be to facilitate regulations under stringent regulations.

Bank of Russia Reports Success of Digital Ruble, Pushes for Crypto Ban

The Russian Central Bank and other financial institutions have begun testing the digitalized national fiat currency, called ‘Digital Ruble.’

Priyanka is an active crypto enthusiast. Having graduated with a BA in Journalism and Mass Communication, she is a passionate content writer with a strong understanding of financial content. She has been writing on crypto and blockchain-related topics for the last three years and is an active trader.

Bank of Russia Reports Success of Digital Ruble, Pushes for Crypto Ban

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