It has been rumored for quite some time now, but it looks like Russia will issue its own digital currency. Speculators are floating such rumors for quite some time now.Vladimir Putin has allegedly unveiled plans to get rid of traditional banking. Issuing a national digital currency makes a lot of sense in this regard. Things could get quite interesting in Russia over the next few months.
It is evident Russia is trying to shake up its national financial system. More specifically, President Putin is looking to get rid of the US Dollar altogether. That is not entirely surprising, as the US Dollar dominates the global economy. It is also quite harmful to the world’s economy at times. Separating oneself from the global economy is quite a dangerous decision, though. Then again, Putin hopes to reintroduce the gold standard in Russia moving forward. That would be rather interesting to see, to say the least.
Russia Wants a Digital Currency on Ethereum
Focusing on the digital economy is also quite important for Russia right now. More specifically, issuing a national digital currency will be quite interesting. Vladimir Putin recently had a discussion with Ethereum founder Vitalik Buterin. It now appears Russia’s digital currency will be based on Ethereum as well. Right now, it is unclear if this will be an ERC20 token or something else entirely, though.
Moreover, Ethereum technology has been part of a major project in Russia already. The central bank deployed an Ethereum-based blockchain to process online payments. Various other financial institutions are taking part in this trial as well. It will be interesting to see what we can expect from this digital currency moving forward. The choice to use Ethereum technology may backfire in the long run, though.
More specifically, the Ethereum network is going through a lot of issues right now. The blockchain is quite slow right now due to the ongoing ICOs. A lot of people spam the network during these crowdfunding campaigns, which causes a major backlog. Issuing a national digital currency on top of such a blockchain could be quite problematic for Russia, that much is evident. It remains to be seen if the Russian digital currency will be successful in the end. If they aim to go ahead with this plan, not using Ethereum may be a far better choice.
Header image courtesy of Shutterstock
