Ukraine Considers CBDC Pilot, Wants to Pay Employees in Digital Currency

Jafrin  |  Aug 19, 2021

Employees working in the Ministry of Digital Transformation of Ukraine will soon receive their salaries in central bank digital currency (CBDC) as part of the pilot initiative to test the e-hryvnia.

Ukraine Considers Paying Staff in e-hryvnia for CBDC Pilot

Ukraine might be the first country in the world to pay their government employees in central bank digital currency (CBDC), once the new hryvnia is ready for testing, Deputy Prime Minister Mikhail Fedorov revealed in an interview.

“We have it on the table as one of the first pilots, the payment of salaries to employees of the Ministry of Digital Transformation in electronic hryvnia.”

Fedorov made his remarks saying the initial rollout of the e-hryvnia should focus on a small, controlled use case rather than social payments. It is also important to test the digital currency to prevent malicious or inappropriate use, according to him. This is why using the CBDC as staff salary payments is a viable plan to trial the national digital currency.

Apart from paying the government employees, the CBDC pilot test also involves paying for social benefits and government subsidies.

Ukrainians Interested in Cryptocurrencies

Ukraine is among the growing list of nations working on developing its own Central Bank Digital Currency (CBDC). Following the ratification of a new payment services law, the central bank received the authorization to issue the electronic hryvnia. The country has also formulated a draft law on virtual assets which is expected to be in force by the end of the year.

The Ministry of Digital Transformation is also involved in the CBDC, having worked with the Stellar Development Foundation to build a joint CBDC and digital asset strategy.

What’s more, Chainalysis’s 2021 Global Crypto Adoption Index report suggests that Ukraine ranks fourth in crypto adoption, while ranking sixth with respect to the on-chain retail value received. Furthermore, the country showed strong P2P exchange trade volumes too, ranking 40th, ahead of the United States and China.

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