Russia created the digital ruble, to limit the impact of economic sanctions for the war

Russia released a Tuesday trial phase to create a digital ruble based on the blockchain technologywith the objective of limit the long-term impact of international sanctions.

Before the sanctionsRussia was forced to rapidly develop alternatives to the global payment system Swift –from which its banks were excluded–, while de-dollarizing its transactions.

He Russian Central Bank (BCR) had already announced last week that 12 banks and 600 individuals were testing this “trial phase”.

“VTB turned the first bank to successfully test the transactions with digital rubles on their mobile app,” he said in a statement the second largest bank in Russia.

Moscow’s goal is limit the impact of sanctions imposed by Western countries after the offensive in Ukraine.

Moscow hopes to extend the digital ruble to all Russians who want it “from now to 2025-2027”according to the response of the BCR.

How does the digital ruble work and what is it for?

For the moment, this digital currency will serve to make payments in 30 points of sale located in 11 cities of the country. In the longer term, “Operations will be free for citizens and with a minimum commission for companies,” the BCR told AFP.

TO difference from cryptocurrencieswhich also use blockchain technology, the digital ruble is part of the CBDC (“central bank digital currency”), highly controlled.

This way, the digital ruble is directly controlled by the BCR and stored in electronic wallets. The security services of the FSB monitor the security of the system.

The authorities claim that the digital ruble will have the ability to make payments more secure. However, some analysts believe that the introduction of a digital currency will allow the government to have more control over citizens.