Today there are a considerable number of different cryptocurrencies. The Crypto ruble is a currency developed by the personal order of the President of the Russian Federation, Vladimir Putin. The fiat ruble and function will stabilize it without mining.
Today, the crypto ruble is a very controversial currency, and everyone has a different attitude towards this. Let’s look at the pros and cons.
Understanding Crypto Ruble
In 2017, Russian President Vladimir Putin announced the creation of a new CBDC, which the Russian government will regulate. The final testing began in the summer of 2021, and the release is planned for as early as 2022.
More than 12 Russian banks have expressed interest in using this cryptocurrency, including the Moscow Credit Bank and the Russian National Commercial Bank in Crimea.
Officially, the main goal of the crypto ruble is to reduce the cost of financial transactions and create additional competition between banks. But at the same time, the Russian Federation has not yet made a specific legal framework for regulating cryptocurrencies.
However, there is an opinion that the crypto ruble is being created to circumvent European sanctions imposed on the Russian Federation in 2014. In confirmation of this, in 2018, the Financial Times published an article citing a statement by Sergei Glazyev (adviser to the President of the Russian Federation). He openly says that the crypto ruble can be an excellent tool for circumventing global sanctions. It is worth noting that Grozyev himself had no right to enter the United States after the sanctions imposed by Obama.
What are the prospects for the development of the crypto ruble?
The Crypto ruble can be an excellent tool for circumventing European and American sanctions. Moreover, before the Russian invasion of Ukraine, this plan seemed very realistic.
After February 2022, the world community imposes enormous sanctions against the Russian Federation. So, today there are practically no banks, electronic wallets, and other payment systems that agree to work in the aggressor country. So, the only way to pay for goods and services in European countries and America is through cryptocurrencies. The blockchain is designed so that it encrypts all transactions, and it works in a decentralized manner. No one can intercept financial transfer data.
It suggests that the crypto ruble was not created in vain, and it can become a useful tool. The Russian market accounts for 12% of the global turnover of cryptocurrencies, which is why it is assumed that crypto exchanges will not join the European and American sanctions.
But practice shows that the world community is not ready to put up with aggression. So, since March 10, Binance stopped using Visa and Mastercard cards issued in Russia. And Coinbase blocked more than 25 thousand users from the Russian Federation. Of course, there are still exchanges that agree to work in Russia, saying that blocking is contrary to the principles of crypto.
After analyzing all the factors, we can give a simple forecast for the crypto ruble. It will be widely used in Russia to circumvent government regulation and reduce transaction costs. As for international transactions, most exchanges will refuse to enter the crypto ruble into their registry. It is connected not only with political views but also with the fact that this currency is fixed in fiat rubles. Moreover, the market value of this currency is not known today. Due to the instability of the Central Bank of Russia, people are unlikely to invest in the crypto ruble massively.
So, even before the military aggression on the part of the Russian Federation against Ukraine, the crypto ruble had a chance to function normally for the domestic and foreign markets. Today, due to the instability of the fiat ruble and the political views of many crypto exchanges, this tool is becoming useless.