Amid the ongoing regulation process of Bitcoin in Russia, the country’s apex financial institution, the Bank of Russia has commenced the testing stage of the proposed Central Bank Digital Currency (CBDC), the Digital ruble. Based on a press release on Tuesday, it is currently in the pilot stage and is being tested by making transfers between users.
The digital ruble is a virtual currency which, although still under improvement, was commissioned by the President of Russia, Vladimir Putin. The digital ruble is equivalent in value to the physical ruble.
There are no plans to handle the digital ruble as a full cryptocurrency like Bitcoin (BTC) or any other coin. The digital ruble will be handed out by the government and no amount of mining will be required for its production.
To kick-start the process of testing on the digital ruble platform, 12 banks indicated their interest initially. So far, 3 out of those banks have incorporated the CBDC platform developed by the Bank of Russia. Amongst the three banks who kickstarted the testing, only two of these have been able to finish off a cycle of Digital ruble transactions between users.
The transfer was done with mobile banking applications. And the other financial institutions that are yet to come on board intend to enter into the testing once they complete their I.T systems.
The users of the new money will have to create wallets on the platform using a mobile application from the bank. Users can now convert non-cash ruble in their bank accounts into CBDC which can now be transferred between users.
One peculiarity of the proposed CBDC is the fact that it is feasible for users to gain access to their wallets via any bank mobile application, provided the bank account belongs to the same user.
Digital Ruble Testing Progresses to the Next Phase
Following this first stage of transfer between users, the digital ruble will advance into being used for purchases starting in the second stage. It will be used to make payments on trading platforms and will be permitted to interact with the Federal Treasury.
The Bank of Russia still has sophisticated plans for the digital asset in the nearest future and is, therefore, creating strategies that will speed up the rate of its actualization. While Russia just entered its testing phase, China’s proposed CBDC is currently being used as the media of exchange at this year’s Olympics Games in Beijing as reported earlier by CryptoMarketsBeat.