Russia's State Duma Passes Digital Ruble Bill, Moves Closer to CBDC Implementation

The State Duma, Russia's lower chamber of parliament, has successfully passed a bill related to the country's central bank digital currency (CBDC), known as the digital ruble. This milestone legislation designates the Bank of Russia as the project's operator and establishes guidelines for the upcoming digital currency.

The bill includes provisions for the creation of a digital ruble platform, defining the rules governing its operation, identifying participants and users of the platform, and introducing digital accounts or wallets. These measures aim to facilitate cashless payments and enhance the accessibility and functionality of the digital ruble.

To ensure proper implementation, the central bank will play a pivotal role in overseeing the entire project. It will be responsible for safeguarding the financial product's security and ensuring accurate record-keeping of transactions.

Before the legislation becomes official, it still needs to pass through the upper chamber of the Russian parliament, the Federation Council. The final step will be President Vladimir Putin's signature, granting it the necessary approval to proceed.

Once established, the digital ruble will be subject to certain restrictions. Consumers will be prohibited from using the CBDC for deposits, and in the event of a debtor's bankruptcy, digital rubles will be included as part of the bankruptcy estate.

Moreover, the introduction of a CBDC opens up the possibility of its utilization in international settlements. Elvira Nabiullina, Governor of the Bank of Russia, has emphasized the digital ruble as a priority project for the institution. Preliminary tests with banks are already underway, and pilot transactions are expected to commence gradually next year.

Notably, prominent Russian figure Vladimir Potanin (not to be confused with Vladmir Putin), who is one of the country's wealthiest individuals, supports the digital ruble. Potanin argues that cryptocurrencies such as Bitcoin and other alternative coins are risky and unreliable products lacking proper regulatory oversight. Instead, he advocates for CBDCs controlled by authorities as a viable financial solution to stimulate Russia's economy.