Bank of Russia planning its own digital currency

Bank of Russia planning its own digital currency

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A Russian national flag flies from the roof of Russia's central bank, also known as Bank Rossii, in Moscow, Russia, on Tuesday, Aug. 5, 2014. Russian government bonds slid, taking yields to a five-year high, and the ruble fell on concern the conflict in Ukraine will escalate after Poland warned President Vladimir Putin may be preparing to invade. Photographer: Andrey Rudakov/Bloomberg

During the past few years, the popularity of digital currencies has grown exponentially. Bitcoin can be considered as a perfect example to prove the above mentioned fact. The value of Bitcoin overtook the value of Gold at the beginning of this year. The price hike of this digital currency continues along with time and we will be able to see it breaking records in the near future. This fact is applicable for all the cryptocurrencies that exist out there in the world. For example, the price of Ethereum reached from $5 to $200 within a short period of time.

Initiatives taken by the Central Bank of Russia

The Central Bank of Russia has got a clear understanding about the increasing demand for digital currencies. As a result, it has got the need to promote digital currencies among people who live within the country as well. As the first step, the Central Bank of Russia is looking forward to develop its own digital currency. We are not too sure about the practicability of the decision that has been taken by the Central Bank of Russia. In fact, the world is filled with digital currencies and we need to see how a new currency can compete with the established currencies such as Bitcoin. However, the senior officials from Central Bank of Russia have already come to a conclusion that they will be planning to come up with a digital currency.

An official announcement about this new initiative was made by Olga Skorobogatova, who is currently serving as the Deputy Chief of the Central Bank of Russia. He recently appeared at the St. Petersburg International Economic Forum, where he delivered a speech about the new initiative that is taken by the bank.

According to TASS, which is the state owned news service of Russia, Olga Skorobogatova has paid special attention towards two main topics while delivering his presentation at the Economic Forum. The first point is related to the digital currencies. Secondly, Olga Skorobogatova has touched on the partners that are looking forward to work along with the Central Bank of Russia in order to implement this new digital currency. Coming up with a new digital currency is not something that the bank can do on its own. The technologies and algorithms associated with it need to be imported from expertise groups. As a result, the bank is looking forward to get into partnerships with few other business entities in order to achieve the primary objective.

Olga Skorobogatova about the new digital currency

Olga Skorobogatova gave a clear overall picture about the digital currency when he was delivering the speech to the audience at Economic forum. It is basically an app and the bank has been exploring it publicly for a period of one year. In fact, the initiative started back in June 2016 and the project has come a long way since then.

The speech delivered by Olga Skorobogatova at the event sounded somewhat aggressive. The regulators of the country have agreed to the fact that it is the high time to come up with a national cryptocurrency. It is the future of currencies and we can expect to live in a world that is dominated by digital currencies. If Russia can come up with a digital currency on its own, it would get the opportunity to gain competitive advantage over other countries in the world. Moreover, it can assist Russia to place itself in a better position among other countries.

Regulators from many different countries in the world have realized the importance of coming up with a new digital currency for the country on its own. The members of European Union have paid special attention towards this fact. Therefore, we can expect The Central Bank of Russia to work with Governments from European Union Countries in order to complete this objective as a collaborative effort.

As per Olga Skorobogatova, the Central Bank of Russia is planning to test the Blockchain with European Union countries with a cooperative approach. These tests would start somewhere around this year. By the end of 2017, we can expect the Central Bank of Russia working hand in hand with the European Union countries in order to test the effectiveness and practicability of the digital currency.

According to the words of Olga Skorobogatova, Blockchain adoption would become one of the highly discussed topics in the world. However, coming up with a new digital currency depends on the financial capability of a specific country. As per the current financial status of China, it would take somewhere around 7-10 years for the Central Bank in order to come up with its fully operational digital currency. However, people will be able to get their hands on the digital currency without waiting for a period of 10 years. It would be deployed to many different projects, which interact with people.

Along with the decision that has been taken by the Central Bank of Russia to come up with its own digital currency, the officials who are working for the project will have to face a lot of challenges in the future. Digital currencies are still in the experimental stage. Since Russia doesn’t have any previous experience in coming up with a digital currency on its own, they will have to work on the project by learning a lot of lessons. This would be the toughest challenge that the Central Bank will have to face.

Conclusion

Russia is not the only country that is engaged with the process of creating a digital currency. Many other countries such as Singapore and China have already started working on similar projects. However, Russia seems to be at a promising position with the initiative. It is clear from the words that have been spoken by Olga Skorobogatova. Therefore, we can expect Russia to come up with a functioning prototype in the near future.

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This is Lutpin, and I edit, review and publish articles for CryptoNews. Sometimes, I also write them myself. I started being interested in bitcoin and cryptocurrencies as far back as late 2012/early 2013. A year later I dropped out of the scene due to losing interest. Since 2015 I'm back in and involved deeper than ever. Besides writing articles, I'm a huge fan of gambling, preferrably combined with cryptocurrencies. Another big interest of mine are physical bitcoins, I know everything about them. Besides Crypto-News and Crypto-Games, you can find me mainly on bitcointalk.org