Digital Ruble of the Central Bank of the Russian Federation

• Main Author: A. Ya. Zaporozhan
• Format: Article
• Language: English
• Published: North-West institute of management of the Russian Presidential Academy of National Economy and Public Administration 2021-08-01
• Series: Управленческое консультирование
• Subjects: cryptocurrency; central bank digital currency; central bank payment system; digital ruble; transactions; anonymity or confidentiality of transaction information; supranational digital currency
• Online Access: https://www.acjournal.ru/jour/article/view/1722

The article is devoted to the study of a new financial instrument — the digital currency of the Central Bank of the Russian Federation. The article examines the reason for the emergence of the Central Bank and its difference from cryptocurrency, analyzes the practice of central banks of foreign states in the development and implementation of digital currencies in the financial system, analyzes the potential risks and benefits associated with their emission, as well as its consequences for the banking sector and monetary politicians.The logic of the article is based on the format of the discussion of the report of the Central Bank of the Russian Federation “Digital Ruble. Public Consultation Report”. In the context of the Central Bank of the Russian Federation report, the article analyzes:two possible              options               for         the        emission            of          the        Central                Bank     in                the        form     of          digital   tokens and       accounts on the settlement accounts of the Central Bank;several possible              models               of          central bank     digital   currency             and       technologies                for         their     imple-mentation;competitive advantages       or          disadvantages of          the        payment            system                of          the                Central                Bank     of          Securities in comparison with traditional banking systems.The article substantiates the position that the payment system of the Central Bank of Securities in comparison with traditional banking systems has no competitive advantages. There-fore, the digital currency of the central bank is not very attractive for economic entities, which limits or even prevents its implementation into practice.The way out of the current situation is to use the Central Securities Market in the field of government payments, thereby increasing the transparency of payments.The practical implementation of the digital currency of the central bank can start with state financing of investment projects in digital rubles, and then on a broader scale with budget financing, when all or a limited list of budget recipients will receive budget money in digital rubles. As a result, other economic actors will gradually be drawn into the payment system of the digital currency of the central bank.