Another Russian crypto expert has warned of the dangers of the nation’s Central Bank issuing a so-called digital ruble, claiming that neither consumers nor banks are yet sold on the idea of using a digital fiat.
In an interview with AB News, Viktor Dostov, the Chairman of the Russian Electronic Money and Remittance Association and the head of the Center for Distributed Ledger Technologies at St. Petersburg State University, said that end-users would likely have their heads turned by digital ruble payment solutions.
Dostov opined that a Russian central bank digital currency (CBDC) would be more “convenient and cheaper” than existing payment platforms.
However, he added that the “attractiveness of switching to the digital ruble” for many other consumers would be “far from obvious.”
Dostov stated that conventional commercial bank-issued alternatives have become easier than ever to use of late, making use of QR codes and contact-free interfaces. He also opined that commercial banks would likely push back against the idea of sharing data on their (and their customers’) transactions so directly with the Central Bank.
Moreover, he said, ordinary citizens would likely become “concerned” that massive digital ruble adoption would allow the “complete transparency of [Russian] payments for the state, creating a “centralized […] database” of spending.
He claimed the financial sector was “still not convinced” of “the necessity and advantages” of a CBDC, “both for themselves and for future customers and users.”
However, Dostov pointed out that the Central Bank is keen to press forward with its plans, which it thinks would allow it to ensure, for instance, that welfare payments and the welfare system in general, is not subject to abuse. The expert added that a digital ruble could ensure that child benefit payments, for example, were only spent in stores selling products for children.
A rollout could take place “in the next few years,” he said. The Central Bank is hoping to pilot a token later in 2021.
And in the face of the Central Bank’s determination, banks and others are gradually moving away from the idea of resisting a CBDC rollout, but instead thinking about “how banks will survive” in this new paradigm and “what new services banks will be able to provide in order to replace the income they lose” if a digital ruble is issued.