Russian Central Bank still expects first cryptocurrency transactions as part of experiment by year-end - Nabiullina
SOCHI. Oct 17 (Interfax) - The Central Bank of Russia still expects the first cryptocurrency transactions under the experimental legal regime to occur by the end of 2024, Central Bank Governor Elvira Nabiullina said.
"We continue to expect that the first transactions will occur by the end of the year. There is interest on the part of participants. However, since the experimental legal regime concerns international settlements, we consider it closed and are not disclosing information on the participants or the number of transactions," Nabiullina told reporters on the sidelines of Finopolis 2024.
"We will see how the settlements function in the experimental legal regime. The experimental legal regime could last up to three years in principle, after which a decision would be reached on whether it is necessary to amend the general regulation. However, this could occur sooner if the results of the experiment allow for it," Nabiullina said.
There was previously a ban on utilizing digital currency for settlements in Russia. A law entered into force on September 1 that allows the Central Bank to use digital currency as a means to render payment in foreign trade activities as part of the experimental legal regime.
Nabiullina in July said that the first cryptocurrency settlements as part of the experiment could occur before the end of the year.
"Many on our side would like to participate in the experiment. At the moment we're working on the schemes and the document packages; we're interacting with the market in order to understand what we still need to do in terms of making this service convenient. Because this is essentially one of those products that should work sufficiently well on the market, even if we're talking about the experiment," First Deputy Governor of the Central Bank Olga Skorobogatova said on the sidelines of the Finopolis forum.
The digital ruble is a third digital form of the national currency that has been designed to expand the options for making payments and funds transfers. Digital ruble transactions have been piloted since August 15, 2023, with around 600 individuals from among employees of 12 banks taking part in the first phase.
The second pilot phase started in September 1, 2024 and has been expanded to allow for more participants, namely 9,000 individuals, previously 600, and 1,200 trade and service companies (TSCs), previously 22. It is anticipated that another 19 banks will join the second pilot phase at a later stage.
Currently, six systemically important banks are taking part in the pilot: Alfa-Bank, VTB , Promsvyazbank , Rosbank , Gazprombank and Sovcombank . The second group will include a further three large banks - Sberbank , Russian Agricultural Bank and TBank .
Skorobogatova said the CBR expected another 14-15 banks to join the digital ruble pilot program in 2025. "Currently, the figure is 12 banks. Another three banks will join the platform in the near future, and next year we're expecting about another 14-15 banks, which as a whole on account of their market share will make it possible to provide digital ruble services to about 80% of clients who use financial services," Skorobogatova said.
The digital ruble is expected to be introduced into wide circulation from July 1, 2025. The CBR's Nabiullina said the regulator planned to fine systemically important credit institutions that fail to provide clients with access to digital ruble transactions by then.
"We are planning to put the digital ruble into wide circulation, we are targeting the middle of next year, for this but the pilot stage must be completed successfully. And we will move to mass rollout only when we are sure that everything is working as it should. And, of course, the first stage of mass rollout from July 1 provides that all systemically important credit institutions will be able to provide clients with services related to the digital ruble," Nabiullina told reporters.
"Of course, we envisage that those who are not ready will have to pay a fine, but legislation must be adopted for this. It has been submitted and we hope it will be adopted," she said.
Skorobogatova, for her part, said the digital ruble platform would be used for Federal Treasury operations from 2026.
"They [the Federal Treasury] are a direct participant in the platform. We have now defined the stages of work with them. At the first stage, these will be pilot operations, that is, we will try several types of operations in pilot conditions, which our colleagues from the treasury have now defined. Next year, we will have an experimental phase, that is, when we will already be conducting operations to the budget with real clients together with the treasury, or vice versa, paying something from the budget in digital rubles," Skorobogatova said.
"We expect the digital ruble platform will be fully up and running for treasury operations from 2026," she said.
