April 14, 2021 at 10:07PM

The digital ruble is moving closer to becoming a reality as the Bank of Russia looks to develop a prototype by the end of 2021, CoinDesk and other news outlets reported.

The proposed central bank digital currency (CBDC) would be controlled by the Bank of Russia and built on a hybrid platform combined with distributed ledger technology (DLT), said Olga Skorobogatova, first deputy governor of the Russian central bank, according to CoinDesk.

Skorobogatova also added that the bank will probably make use of open-source code to develop a proprietary digital currency, which will be created by December. The news follows the publication of a consultation paper about the implementation process and research that was conducted with stakeholders, CoinDesk reported.

“The selected target model is a two-tier retail model which assumes that the Bank of Russia is both the issuer of digital rubles and the operator of the digital ruble platform,” the bank said in an announcement. “At the same time, financial institutions open electronic wallets for their clients and perform operations over these wallets on the digital ruble platform.”

The Russian bank said it is moving forward with its CBDC to “help reduce costs for households and businesses, increase the speed of payments, and develop innovative products and services in the financial industry and the economy in general,” the announcement stated.

“We’ve been looking at many projects, and many would like to say they have a ready-to-use product, but [they don’t] work for the digital ruble,” Skorobogatova said, per CoinDesk.

The CBR said last December that digital currencies could lead to the SWIFT global payments network as being unnecessary, PYMNTS reported. As Russia’s central trade partner, China has also been piloting its own digital yuan. Additionally, the European Union is working on a digital euro, and Sweden is testing its CBDC.

Russian Central Bank Moves Closer To Digital Ruble …

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