Column by Maxim Builov on simplifying the new form of the ruble

The Central Bank unexpectedly published a detailed report on the great benefits of tokenizing non-cash rubles – of course, with all the associated risks. This form should speed up settlements and execution of smart contracts (automatic transactions when certain conditions are reached). At the same time, tokenized non-cash money will be kept in commercial banks, which distinguishes it favorably from digital rubles remaining in the Bank of Russia.

Back in November 2020, Sberbank proposed tokenize non-cash rubles instead of fiddling with the digital ruble, but then the Central Bank insisted on its concept. Now the digital ruble is gradually shedding some of the functions defined for it, like a balloon — ballast in order to rise to the desired height.

This week, Central Bank Deputy Chairman Alexei Zabotkin said that the “coloring” function will be considered at later stages of promoting the digital ruble. By the end of 2024, the introduction of technology that allows it to be piloted offline has also been pushed back, as was announced last week by the first deputy chairman of the Central Bank, Olga Skorobogatova. The authorities are doing everything to ensure that the Internet works everywhere, so this function is not really needed.

More than two months ago, in the relevant law, the term “digital wallet” was replaced by “digital account” (see “Kommersant” dated June 28). And the head of the State Duma’s financial committee, Anatoly Aksakov, explained that the word “wallet” is ideologically not suitable for the digital ruble.

All these explanations, simplifications, and delays look quite logical. The account is used for working with non-cash money. The coverage of the Internet in Russia is really large, and, according to knowledgeable people, the task of paying with a digital ruble is very non-trivial and has a lot of pitfalls. Coloring digital currency may discourage citizens from using this form of money.

And what happens when citizens do not want to use the service can be seen in the example of the Unified Biometric System (UBS), for which it was difficult to obtain several hundred thousand digital impressions. And how the Bank of Russia reacts to such challenges is also clearly shown by the EBS – the mega-regulator is following the path of simplifying the system. Millions of databases of impressions collected by commercial banks, which were previously categorically not suitable for state biometrics, are now turned into vectors and easily integrated into it.

So there is no need to rush into the full launch of the digital ruble. After all, tokenized rubles will ensure high speed of non-cash payments. Electronic certificates will help with coloring, already allowing you to pay for certain categories of goods and services (see “Kommersant” dated November 11, 2021). And paper rubles can handle offline payments just fine.