Topic: CBDC in Russia (Read 315 times)

For people to use banking applications, the country needs good internet. You probably have not been to Russia, but even in the western part to the Urals there are a lot of places where there is no Internet, and in Siberia in many places there is not even a mobile connection. This requires huge investments, so as a maximum CBDC can be launched in large cities at the beginning.

So how do they get around this problem? If they want to cover the entire vast Russian territory, they need to spend huge amounts of money to create a suitable infrastructure for using CBDC, and this may take many years.
During this period, will there be two financial systems, one digital and the other monetary?

Also, in those remote areas, people are not accustomed to using the Internet and mobile phones. How will the state be able to convert them to the digital system when they are not familiar with this type of technology?

More than anything, before they delve into fullscale CDBC operations, they should focus more on buiding the technological infrastructure for internet service provision for those interiors without it and also a major case of sensitisation should be considered as many people are used to the regular financial system, mostly, the elderly folks who have spent their entire lives in the conventional financial system.

Russia can achieve whatever it wants to achieve steming from their degree of influence and commtiments to their involvements. I don't consider these few observations much of an implementation problem for them.

In Russia, the majority of the population lives in cities and small towns. The only difference is the population size and, accordingly, the name. In such places there are no problems with infrastructure and during these 2 years people will be trapped with various bonuses. I think this will be a major development priority for CDBC. It will not be possible to quickly add infrastructure to remote villages and settlements with less than 1,000 inhabitants, so I hope the cash will be available for a long time.

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Quote from: Zoomic on July 31, 2023, 03:03:03 AM

For people to use banking applications, the country needs good internet. You probably have not been to Russia, but even in the western part to the Urals there are a lot of places where there is no Internet, and in Siberia in many places there is not even a mobile connection. This requires huge investments, so as a maximum CBDC can be launched in large cities at the beginning.

So how do they get around this problem? If they want to cover the entire vast Russian territory, they need to spend huge amounts of money to create a suitable infrastructure for using CBDC, and this may take many years.
During this period, will there be two financial systems, one digital and the other monetary?

Also, in those remote areas, people are not accustomed to using the Internet and mobile phones. How will the state be able to convert them to the digital system when they are not familiar with this type of technology?

More than anything, before they delve into fullscale CDBC operations, they should focus more on buiding the technological infrastructure for internet service provision for those interiors without it and also a major case of sensitisation should be considered as many people are used to the regular financial system, mostly, the elderly folks who have spent their entire lives in the conventional financial system.

Russia can achieve whatever it wants to achieve steming from their degree of influence and commtiments to their involvements. I don't consider these few observations much of an implementation problem for them.

zasad@

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Quote from: UmerIdrees on July 27, 2023, 03:44:34 AM

I guess they would plan to keep Bitcoin and crypto illegal but promote and legalize the self-developed CBDC so the power still remains with the government and big financial institutions.

How come Bitcoin / Crypto promotes money laundering and this CBDC is anti-money laundering, Ridiculous !!!

I was afraid that the battle of the government against bitcoin and crypto will become intense and probably crypto will now, little did I know that the government is also scared of crypto dominance. They had no option than to invest in the blockchain but in a highly centralized way. The dilemma is tagging crypto illegal and creating a copy of the illegal and calling it legal.

Now the legal CBDC will fight money laundering. We are watching together.

Quote from: teosanru on July 30, 2023, 11:46:40 AM

I wrote about the implementation of CBDC in Nigeria, and now I want to describe this process in Russia in detail
https://bitcointalksearch.org/topic/new-world-order-or-cbdc-against-cryptocurrencies-5440827

The same reason Nigerian CBDC (e-naira) failed. The Nigerian central bank launched their e-naira when crypto transaction was illegal in the country. So the idea didn't sell.

Governments are not afraid of cryptocurrencies. Blockchain is like an open ledger where all transactions are stored. It is not the government that needs to be afraid of cryptocurrencies, but the criminals who use cryptocurrencies need to be afraid of the government, because blockchain analysis technologies work more efficiently every year and allow you to get on the trail of criminals and non-taxpayers.

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which means all are just betting on the fact that it might be great alternative to fiat but actually it's no where better than fiat at any level.

I believe it is a matter of infrastructure building. If they managed to build a solid network that is not prone to hacking and is easy to use, they will likely pivot to it as soon as possible since it offers better control over their fiat transactions.

Quote from: Zoomic on July 31, 2023, 03:03:03 AM

They had no option than to invest in the blockchain but in a highly centralized way. The dilemma is tagging crypto illegal and creating a copy of the illegal and calling it legal.

I mean that should be expected. The government's main goal is to control the economy. I don't see why they will shy away to copy any new tech even if it was used by something that they deemed illegal. Some of them even fund privacy technology, probably to add another point of control over their people.

Zoomic

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Quote from: UmerIdrees on July 27, 2023, 03:44:34 AM

I guess they would plan to keep Bitcoin and crypto illegal but promote and legalize the self-developed CBDC so the power still remains with the government and big financial institutions.

How come Bitcoin / Crypto promotes money laundering and this CBDC is anti-money laundering, Ridiculous !!!

I was afraid that the battle of the government against bitcoin and crypto will become intense and probably crypto will now, little did I know that the government is also scared of crypto dominance. They had no option than to invest in the blockchain but in a highly centralized way. The dilemma is tagging crypto illegal and creating a copy of the illegal and calling it legal.

Now the legal CBDC will fight money laundering. We are watching together.

I wrote about the implementation of CBDC in Nigeria, and now I want to describe this process in Russia in detail
https://bitcointalksearch.org/topic/new-world-order-or-cbdc-against-cryptocurrencies-5440827

The same reason Nigerian CBDC (e-naira) failed. The Nigerian central bank launched their e-naira when crypto transaction was illegal in the country. So the idea didn't sell.

teosanru

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Another country, another fiat onto blockchain dream and hence another CBDC, more and more countries are bringing in CBDC but not even a single country that I have seen has actually made it to the next level in CBDC, which means all are just betting on the fact that it might be great alternative to fiat but actually it's no where better than fiat at any level.

zasad@

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Quote from: cryptosize on July 29, 2023, 05:39:17 AM

For people to use banking applications, the country needs good internet. You probably have not been to Russia, but even in the western part to the Urals there are a lot of places where there is no Internet, and in Siberia in many places there is not even a mobile connection. This requires huge investments, so as a maximum CBDC can be launched in large cities at the beginning.

So how do they get around this problem? If they want to cover the entire vast Russian territory, they need to spend huge amounts of money to create a suitable infrastructure for using CBDC, and this may take many years.
During this period, will there be two financial systems, one digital and the other monetary?

Also, in those remote areas, people are not accustomed to using the Internet and mobile phones. How will the state be able to convert them to the digital system when they are not familiar with this type of technology?

If we return to the world conspiracy theory, which wants to send all people to a digital concentration camp, then Russia will be given all the necessary technologies despite the sanctions. But the main implementation will begin only in 2025, while testing in some large regions will be during these one and a half years.
In many places in Russia, SMS transfers are very popular. This is done easily by sending an SMS to the bank number with the text: "transfer_recipient's phone number_amount in rubles".
It's not hard to teach anyone.

joniboini

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I'm sure they will invest in digital infrastructure (fiber optics, mobile/satellite coverage).

If the condition is really that bad, I believe they should focus on that first. It should provide a good base to develop legal regulations if the infrastructures are great. On the other hand, maybe this is one of the reasons why they will limit it to city or other areas with good internet access.

During this period, will there be two financial systems, one digital and the other monetary?

Doesn't thing like this already exist with fiat right now? I'm referring to how people can pay with cash or use their phone to pay with digital wallet apps or PayPal.

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For people to use banking applications, the country needs good internet. You probably have not been to Russia, but even in the western part to the Urals there are a lot of places where there is no Internet, and in Siberia in many places there is not even a mobile connection. This requires huge investments, so as a maximum CBDC can be launched in large cities at the beginning.

So how do they get around this problem? If they want to cover the entire vast Russian territory, they need to spend huge amounts of money to create a suitable infrastructure for using CBDC, and this may take many years.
During this period, will there be two financial systems, one digital and the other monetary?

Also, in those remote areas, people are not accustomed to using the Internet and mobile phones. How will the state be able to convert them to the digital system when they are not familiar with this type of technology?

cryptosize

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Quote from: bittraffic on July 28, 2023, 11:05:33 AM

Quote from: bittraffic on July 28, 2023, 11:05:33 AM

Russia has a large territory and it is impossible to ban cash there in a few years, but many countries have been unlucky in this regard. In countries with a small territory, it is easier to digitize all citizens and make a digital wallet for everyone. In Russia, this will first be implemented where the Internet is massively available, because many people use banking services via SMS.

The whole world is launching CBDC and so the future is all digitalization and we're all gonna be seeing digitalization of assets and Putin knows it.
In wartime, it's easy to make it happen when they are going to have a database of all people in each city. But they will need to incentivize the use of CBDC in order for it to be used by people in the remote area.

The sad part is that it's still gonna be aa wealth transfer and the poor get poorer still.

For people to use banking applications, the country needs good internet. You probably have not been to Russia, but even in the western part to the Urals there are a lot of places where there is no Internet, and in Siberia in many places there is not even a mobile connection. This requires huge investments, so as a maximum CBDC can be launched in large cities at the beginning.

I'm sure they will invest in digital infrastructure (fiber optics, mobile/satellite coverage).

zasad@

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Russia has a large territory and it is impossible to ban cash there in a few years, but many countries have been unlucky in this regard. In countries with a small territory, it is easier to digitize all citizens and make a digital wallet for everyone. In Russia, this will first be implemented where the Internet is massively available, because many people use banking services via SMS.

The whole world is launching CBDC and so the future is all digitalization and we're all gonna be seeing digitalization of assets and Putin knows it.
In wartime, it's easy to make it happen when they are going to have a database of all people in each city. But they will need to incentivize the use of CBDC in order for it to be used by people in the remote area.

The sad part is that it's still gonna be aa wealth transfer and the poor get poorer still.

For people to use banking applications, the country needs good internet. You probably have not been to Russia, but even in the western part to the Urals there are a lot of places where there is no Internet, and in Siberia in many places there is not even a mobile connection. This requires huge investments, so as a maximum CBDC can be launched in large cities at the beginning.

Gozie51

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Russia has a large territory and it is impossible to ban cash there in a few years, but many countries have been unlucky in this regard. In countries with a small territory, it is easier to digitize all citizens and make a digital wallet for everyone. In Russia, this will first be implemented where the Internet is massively available, because many people use banking services via SMS.

Putin is trying everything possible not to make the Russians suffer the hardship from the sanctions since the beginning of the war with Ukraine since last year. I remember before the war started, Russia was not a bitcoin friendly country but after the sanctions, effort have been made to legalize bitcoin so that digital transactions can be opened with countries who are willing to trade with them. And now digital ruble is about to be launched in Aug 1 as optional financial transaction and transfers not investment, like other CBDC I think the whole essence is for convenience and ease for the banking industry.

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Quote from: cryptosize on July 28, 2023, 06:23:16 AM

Russia has a large territory and it is impossible to ban cash there in a few years, but many countries have been unlucky in this regard. In countries with a small territory, it is easier to digitize all citizens and make a digital wallet for everyone. In Russia, this will first be implemented where the Internet is massively available, because many people use banking services via SMS.

The whole world is launching CBDC and so the future is all digitalization and we're all gonna be seeing digitalization of assets and Putin knows it.
In wartime, it's easy to make it happen when they are going to have a database of all people in each city. But they will need to incentivize the use of CBDC in order for it to be used by people in the remote area.

The sad part is that it's still gonna be aa wealth transfer and the poor get poorer still.

zasad@

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Russia has a large territory and it is impossible to ban cash there in a few years, but many countries have been unlucky in this regard. In countries with a small territory, it is easier to digitize all citizens and make a digital wallet for everyone. In Russia, this will first be implemented where the Internet is massively available, because many people use banking services via SMS.

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Farewell, Leo

Now imagine ECB launching CBDC and making a smart contract that forbids your wallet from sending money to well-known CEXes like Coinbase, Binance, Kraken etc.

Good. So that means we'll have an abrupt rise in peer-to-peer exchanges like Bisq. Again, there is no way to stop me from buying bitcoin, unless you enforce me to justify every transaction I make, and even that way, you can't know I'm lying.

Quote from: cryptosize on July 28, 2023, 06:23:16 AM

Of course people will be ingenious to find other -roundabout- solutions: I can buy a highly-sought product (let's say a PS5 or an iPhone*) with CBDC and then sell it in the black market for BTC.

That's very roundabout. Just sell it peer-to-peer, and you can even select a premium price. In fact, I have never sold bitcoin without a premium price once. I'm regularly charging an extra 5% whenever I'm not in hurry, and a 2% when I'm in hurry. People buy those.

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Quote from: BlackHatCoiner on July 27, 2023, 09:56:03 AM

I don't understand how a CBDC can completely forbid its users from buying bitcoin, unless there has to be a justification for every transaction happening, which besides utopian is neither going to work in practice.

It's very easy actually...

Have you seen how Market Pass works? It only allows transactions to stores that sell food. And that's not even CBDC, it's still fiat.

Now imagine ECB launching CBDC and making a smart contract that forbids your wallet from sending money to well-known CEXes like Coinbase, Binance, Kraken etc.

Some banks already enforce that (Ethniki for example) with the already existing fiat currency.

Of course people will be ingenious to find other -roundabout- solutions: I can buy a highly-sought product (let's say a PS5 or an iPhone*) with CBDC and then sell it in the black market for BTC. Grin

But that means the CBDC -> BTC exchange rate won't be very favorable... in fact, I don't even expect 1:1 parity (despite ECB enforcing it) between the physical (zero limitations) and the digital euro (CBDC).

* assuming you will still be allowed to buy these products, because even that is not 100% certain:

https://www.theverge.com/2023/6/14/23760879/sony-ps5-cloud-streaming-games-test
https://www.theverge.com/2022/3/24/22994814/apple-iphone-hardware-subscription-bundle-report

Maybe they will tell you that owning these devices emits way too much CO2, therefore this kind of purchases would quickly deduct your carbon credits. Roll Eyes

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Quote from: avikz on July 27, 2023, 12:43:37 PM

Don't be surprised if all major economies move to CBDC by 2025. Because CBDC has multifold benefits for a government. It easy to create, no cost for money printing. No headache to fight counterfeit currencies. 100% visibility on the financial data of their citizens which will be very effective against money laundering and income tax evasion cases.

So Russia has just jumped into this bandwagon but very soon many other major economies will start announcing their plan for CBDC. So buy Bitcoin if you want to save yourself from state surveillance.

Most friendly nations to Russia have developed their CBDCs. China and India have been Russia's major partners and have refused to join NATO states to sanction Kremlin. With the exclusion of Russia from SWIFT the international payment system, international trade payment between these nations has not been easy. Central Bank Digital Currency seems to be one of the means of helping Russia invade sanctions. But I am viewing CBDC as the beginning of the end of fiat currency. Before, at least it took efforts of minting to print a currency, now it might take just a click to produce billions of a country's currency. Without adequate security, hackers can cause harm to the system and issue billions in no time.

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Quote from: m2017 on July 27, 2023, 04:22:56 AM

From August 1, the law will come into force, but CBDC won't work everywhere and it is not yet clear how this will work in practice.

I do not understand the idea of CBDC. The country does not want bitcoin to be legalized but since they see the people's interest in crypto coins, they decide to launch their own CBDCs. The government control CBDC with no control over the supply is a no threat to bitcoin.

I've been following this as well, and here's the first bad news. QIWI bank in Russia is often used to exchange cryptocurrencies for fiat and vice versa, it is very easy to get a bank card from them. Now the bank is under restrictions and under such conditions it is impossible to buy and sell cryptocurrencies.

https://novayagazeta.eu/articles/2023/07/25/qiwi-po-trebovaniiu-tsentrobanka-vremenno-ogranichila-vozmozhnost-vyvodit-dengi-s-koshelkov-news
"The press service of the bank said that from today, QIWI users will not be able to:
transfer more than a thousand rubles (12 $) a month to cards of other banks;
withdraw money from the wallet through the fast payment system (FPS);
withdraw cash from QIWI Cards, even at QIWI and partners' offices;
make transfers from QIWI Wallet via Contact;
repay a loan from any bank, except for loans from microfinance organizations."

avikz

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Don't be surprised if all major economies move to CBDC by 2025. Because CBDC has multifold benefits for a government. It easy to create, no cost for money printing. No headache to fight counterfeit currencies. 100% visibility on the financial data of their citizens which will be very effective against money laundering and income tax evasion cases.

So Russia has just jumped into this bandwagon but very soon many other major economies will start announcing their plan for CBDC. So buy Bitcoin if you want to save yourself from state surveillance.

BlackHatCoiner

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Farewell, Leo

Also when all the countries do not have their CBDC, how will they operate within the countries? One contury want to trade in fiat while other in CBDC Huh

Or will the people be allowed to buy bitcoin through CBDC

CBDC is pretty simple in concept. Money that is exclusively available digitally. There will be no difference, other than the lack of physical currency (i.e., banknotes). You cannot understand the difference when trading fiat with CBDC electronically; it'll be like trading national currencies via some Internet broker.

I don't understand how a CBDC can completely forbid its users from buying bitcoin, unless there has to be a justification for every transaction happening, which besides utopian is neither going to work in practice.

m2017

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From August 1, the law will come into force, but CBDC won't work everywhere and it is not yet clear how this will work in practice.

I do not understand the idea of CBDC. The country does not want bitcoin to be legalized but since they see the people's interest in crypto coins, they decide to launch their own CBDCs. The government control CBDC with no control over the supply is a no threat to bitcoin.

The launch is completely unrelated to people's interest in crypto currencies and the implementation of CBDC is carried out for completely different purposes.

Also when all the countries do not have their CBDC, how will they operate within the countries? One contury want to trade in fiat while other in CBDC Huh

Or will the people be allowed to buy bitcoin through CBDC ?

Within countries, CBDC will work just like the domestic currency of any country. I doubt people will be allowed to buy (and own) bitcoin, even for CBDC. Where CBDC dominates, there will be no room for Bicoin.

I don't see this model working well as of the developments till now Huh

It seems to me that they themselves don't properly understand how it will work and exactly how it will be implemented, but they can't resist the temptation to use the CBDC opportunities . As you can see, CBDC is progressively moving towards implementation in "not calm" countries.

zasad@

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From August 1, the law will come into force, but CBDC won't work everywhere and it is not yet clear how this will work in practice.

I do not understand the idea of CBDC. The country does not want bitcoin to be legalized but since they see the people's interest in crypto coins, they decide to launch their own CBDCs. The government control CBDC with no control over the supply is a no threat to bitcoin.
Also when all the countries do not have their CBDC, how will they operate within the countries? One contury want to trade in fiat while other in CBDC Huh

Or will the people be allowed to buy bitcoin through CBDC ?

I don't see this model working well as of the developments till now Huh

I'm sure the CBDCs have more global missions because they start around the same time. In Russia, the system of bans has never worked, so they don’t ban cryptocurrencies there and don’t even try to make legislation. In Russia, there are still no laws on cryptocurrencies. If the goals of the CBDC are total control of the population, then it will be necessary to reduce the number of banks and reduce the amount of cash.

UmerIdrees

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I don't see this model working well as of the developments till now Huh

You need to wait as countries are looking to introduce their own CBDC and sooner or later every country will have its own CBDC. Even in my country, Pakistan launches new laws to expedite CBDC launch by 2025, where the crypto is not legal but CBDC will be part of CBDC.

I guess they would plan to keep Bitcoin and crypto illegal but promote and legalize the self-developed CBDC so the power still remains with the government and big financial institutions.

How come Bitcoin / Crypto promotes money laundering and this CBDC is anti-money laundering, Ridiculous !!!

[

jc01480

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Nope..

From August 1, the law will come into force, but CBDC won't work everywhere and it is not yet clear how this will work in practice.

I do not understand the idea of CBDC. The country does not want bitcoin to be legalized but since they see the people's interest in crypto coins, they decide to launch their own CBDCs. The government control CBDC with no control over the supply is a no threat to bitcoin.
Also when all the countries do not have their CBDC, how will they operate within the countries? One contury want to trade in fiat while other in CBDC Huh

Or will the people be allowed to buy bitcoin through CBDC ?

I don't see this model working well as of the developments till now Huh

The government doesn't want private individuals (corporations) to control a cryptocurrency as it could undermine the national currency control schemes (e.g., avoid sanctions, controls, and legal obligations). As long as the government controls it, it can impose a much broader swath of restrictions, albeit digitally. For example, they don't have to issue sanctions. They can quietly prohibit cryptocurrency exchange by any party that is deemed whatever. Dissidents, thieves, political figures, you name it. They control the entirety of the pocketbook. Credit and debit cards are a highly loose form of this digital control. With CBDC, they can do it instantaneously. You can only spend on what they say you can spend with whoever they say. Don't want anyone buying guns? Ban the exchange addresses of all gun dealers. No legislation or negotiation is needed. This is an autocrat or dictator's dream.

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