Will sanctions force Russia to create a CBDC of its own?

[Abiky]

Ever since the US and its allies imposed economic sanctions on Russia, the country's been going downhill at a fast pace. Putin will have no choice but to look for other ways to help sustain the economy. He can either seek the help of China, back the Ruble with the value of a Bitcoin, or simply order Russia's Central Bank to create the new "digital Ruble". I think Putin will take the latter option in order to become impervious from sanctions in the long term. A digital Ruble living on its own blockchain network would be truly unstoppable. If other countries wanted to bring down Russia's economy, they would need to shut down the entire Internet to become successful (something that's largely impossible). Imagine if the new digital Ruble is launched as a sidechain to the main Bitcoin blockchain. It'll be as secure and censorship-resistant as Bitcoin is, greatly undermining the US Dollar's influence in the mainstream world.

Do you think economic sanctions will force Russia to create a CBDC of its own? If not, why? How do you think Russia's economy will fare in the next 5-10 years? Your input will be greatly appreciated. Thank you.

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[goaldigger]

Do you think economic sanctions will force Russia to create a CBDC of its own? If not, why? How do you think Russia's economy will fare in the next 5-10 years? Your input will be greatly appreciated. Thank you.

Those sanctions are forcing Russia to create a new platform that can benefit them, they left Russia with no choice so in order for them to survive, they should innovate and that CBDC are more possible to happen. Russian economy will feel those sanctions in the coming years, many countries are already cutting ties with Russia and that’s very crucial for them. Their army can’t feed their own people if ever, and most probably more wars will happen in the coming years if they failed to survive on those sanctions. In 5 years time, we might see Russian economy to slowly recover again, we’ll see this based on their next move with Ukraine’s war.

[Gyfts]

They could if they wanted, but there isn't an incentive for anyone to adopt a ruble based CBDC. If they want to create a system that is more immune to sanctions, would seem a whole lot easier just for people to adopt Bitcoin instead. Perhaps I'm being shortsighted - if the ruble is increasingly becoming worthless, digitalizing the currency serves no purpose. It's not as if ruble is a reserve currency. CBDC's just give more central authority to the major banks. Problem with the current sanctions is that their economy and assets are being frozen, a CBDC won't fix any of this.

[Fatunad]

Do you think economic sanctions will force Russia to create a CBDC of its own? If not, why? How do you think Russia's economy will fare in the next 5-10 years? Your input will be greatly appreciated. Thank you.

Those sanctions are forcing Russia to create a new platform that can benefit them, they left Russia with no choice so in order for them to survive, they should innovate and that CBDC are more possible to happen. Russian economy will feel those sanctions in the coming years, many countries are already cutting ties with Russia and that’s very crucial for them. Their army can’t feed their own people if ever, and most probably more wars will happen in the coming years if they failed to survive on those sanctions. In 5 years time, we might see Russian economy to slowly recover again, we’ll see this based on their next move with Ukraine’s war.

We could really only speculate but in most probability case that there would be some hardship on retaining their economy considering that sanctions is through left and right which even a powerful and rich country
like Russia wont able to sustain out for several years.Yes, they might have some reserves but doesnt mean that it they wont cut short.Whether they would decide to make their CBDC on their own or not.
We dont know on whats the actual plans that they do have in mind on sustaining theirselves on these hard times.

[pakhitheboss]

Sanctions have not yet affected Russia as was expected by the Western allies. The reason they are still dependent on the Russian gas. In my opinion if Russia wants to by pass these sanctions in the future then they would go for CBDC as it negates the role of SWIFT in cross border payment. You can find a detailed information on how CBDC can remove the monopoly of USD in this article.

[Moneyprism]

it is very likely that this will happen because indeed most countries are currently heading that way... Russia seems to be forced to be independent and although this will cost them a lot of money, in the future it will give them independence and new economic power.

[Fortify]

Ever since the US and its allies imposed economic sanctions on Russia, the country's been going downhill at a fast pace. Putin will have no choice but to look for other ways to help sustain the economy. He can either seek the help of China, back the Ruble with the value of a Bitcoin, or simply order Russia's Central Bank to create the new "digital Ruble". I think Putin will take the latter option in order to become impervious from sanctions in the long term. A digital Ruble living on its own blockchain network would be truly unstoppable. If other countries wanted to bring down Russia's economy, they would need to shut down the entire Internet to become successful (something that's largely impossible). Imagine if the new digital Ruble is launched as a sidechain to the main Bitcoin blockchain. It'll be as secure and censorship-resistant as Bitcoin is, greatly undermining the US Dollar's influence in the mainstream world.

Do you think economic sanctions will force Russia to create a CBDC of its own? If not, why? How do you think Russia's economy will fare in the next 5-10 years? Your input will be greatly appreciated. Thank you.

They may as well, as the Russian economy is at junk status right now they don't have much to lose. However, because it is the sensible option for them to be doing, it would potentially make them pioneers in the field, it is likely that the government will do exactly the opposite and not launch it. They're looking for ways around sanctions, but it might only be a useful currency for internal citizens of Russia, as few people would be willing to trust the Russia government to have control over a digital coin, especially when it looks like the country is heading towards a default right now. Currency does strongly rely on trust and it simply is not there any more, if it ever was.

[Upgrade00]

A digital Ruble living on its own blockchain network would be truly unstoppable. If other countries wanted to bring down Russia's economy, they would need to shut down the entire Internet to become successful (something that's largely impossible). Imagine if the new digital Ruble is launched as a sidechain to the main Bitcoin blockchain. It'll be as secure and censorship-resistant as Bitcoin is, greatly undermining the US Dollar's influence in the mainstream world.

Countries can simply ban Russia's digital blockchain and not interact with it as a way of imposing sanctions, just as some countries have done with Bitcoin. Of course it would be possible to trade it P2P without banks or government intervention, but this would have little effect to the country as majority the trades that boosts economies do not happen covertly, but rather publicly between Nations.

Few weeks ago, Russia requested that E.U Nations purchase their oil in ruble as a way to boost the currency and in turn the economy.
Creating a CBDC would not evade sanctions, it would just be another centralized digital currency.

[tabas]

They can do that but I don't think that they will. Although they've got a new rule that it's going to be Rubles that shall be used to pay for their commodities needed by other countries.
I guess that's already good enough for them not to make their own CBDC. But as they have already been aware about the potential of having their own crypto through CBDC, who knows what's on it for tomorrow.

[Lucius]

A digital Ruble living on its own blockchain network would be truly unstoppable. If other countries wanted to bring down Russia's economy, they would need to shut down the entire Internet to become successful (something that's largely impossible). Imagine if the new digital Ruble is launched as a sidechain to the main Bitcoin blockchain. It'll be as secure and censorship-resistant as Bitcoin is, greatly undermining the US Dollar's influence in the mainstream world.

What is the benefit of digital currency if most of the world will not accept it? Let's say that Russia has its own CBDC at the moment, it would have to convince all its allies to accept the currency and that would make trading somewhat easier for them - but that doesn't solve their problem with sanctions imposed on almost all major countries.

Do you think economic sanctions will force Russia to create a CBDC of its own? If not, why? How do you think Russia's economy will fare in the next 5-10 years? Your input will be greatly appreciated. Thank you.

I know there have been some stories that they are working on it, but as I have already written I do not believe that something like this can help them save their economy. In 5-10 years, Russia can be back to where it was before the war because it has what the world needs (oil, gas, nuclear fuel ...), but only if war ends as soon as possible. Of course, the condition for lifting the sanctions will be for Putin to step down, but he can always set up a puppet to rule for him.

People are very forgetful (or pretend to have forgotten), so it is possible that Germany is leading the EU, and 80 years ago they caused the deaths of tens of millions of people - Serbia, which only 30 years ago did the same thing Russia does today, is a candidate to join the EU without changing their foreign policy towards their neighbors at all.

[Ozero]

Sanctions have not yet affected Russia as was expected by the Western allies. The reason they are still dependent on the Russian gas. In my opinion if Russia wants to by pass these sanctions in the future then they would go for CBDC as it negates the role of SWIFT in cross border payment. You can find a detailed information on how CBDC can remove the monopoly of USD in this article.

In my opinion, the introduction by Russia of its digitized ruble will in no way change the situation with the international sanctions imposed against it. The digital ruble is only an improved banking system for the non-cash ruble. The digitized ruble will become faster and more efficient in its transactions. But some of the sanctions concern the prohibition of Russian banks from operating in the international financial sector, another part led to the freezing of Russia's financial assets outside of Russia, and others imposed restrictions or a complete ban on the import and export of certain groups of goods. That is, the sanctions are aimed at significantly restricting Russia from trading with the outside world, and the emergence of a digitized ruble will not be able to improve this situation in any way.

[Doan9269]

He can either seek the help of China, back the Ruble with the value of a Bitcoin, or simply order Russia's Central Bank to create the new "digital Ruble".

Going by China is not a good option and I Know Putin himself is quite aware of that, the truth is that Russia cannot be subjected to any country and cant stand to begin to develop a problem with china at long run, and creating a CBDC is the worse option here as well except they go for bitcoin, why is because launching a CBDC is just a showcase to advance the already delapitated Rubble into display in another form (digital), there economy will still be tie to the same condition on Rubble if they launch CBDC, therefore i see it as not a game changer in this regard for now.

A digital Ruble living on its own blockchain network would be truly unstoppable. If other countries wanted to bring down Russia's economy, they would need to shut down the entire Internet to become successful (something that's largely impossible).

But it is largely possible for the whole world not to give in on Russia economy, an economy is said to be stable if the world recognizes it, value it and patronize it, if Russia built it own system on blockchain and run CBDC who will patronize them? can Russia survived all by itself? No, there must be concession with other economies and nations to in other to build an outstanding result, a market that lacks patronage is a void as air in a vacuum.

Do you think economic sanctions will force Russia to create a CBDC of its own? If not, why? How do you think Russia's economy will fare in the next 5-10 years? Your input will be greatly appreciated. Thank you.

It is simple, Putin should realize what he did as a global genocide which is unacceptable by any chance nor tolerated and make through his way to amend his actions to gain back the world's interested, secondly Russia should have a change in power. and lastly launch CBDC isn't the solution but rather compound to it, what about the international ties Russia has lost with many countries, who want to be identified with Russia as for now? none, the only solution is bitcoin and not Russia's Digital Rubble.

[Hydrogen]

How do you think Russia's economy will fare in the next 5-10 years?

Russia seeks to become larger, wealthier and more powerful. While opposition forces seek to keep russia poor and contained.

Over the next 5-10 years, both sides will maneuver and make adjustments to gain an advantage. Whichever side does a better job of it will emerge victorious.

In a traditional war, russia would dominate the land war, while SWIFT bans and economic sanctions would dominate the economic war.

But it appears we're living in a new era now. Russian tanks aren't the dominant force they were 50 years ago. Drones, IEDs, laser guided artillery and other new developments are changing war significantly.

SWIFT and economic sanctions aren't the dominant power they were 50 years ago either. Digital currencies and crypto have also shifted the worlds of finance and economics.

Whoever is willing to change and adapt quicker could gain the upper hand here IMO. Conventional wisdom is becoming outdated and obsolete at a faster rate in contrast to previous eras of history.

[hatshepsut93]

How can CBDC help Russian economy if they don't produce things? Look at this chart of Russian imports - almost all of it is just raw materials. Fossil fuels, metals, chemicals, agriculture. High technology products are just a tiny part of it. If their Western buyers will just switch to alternative sources, which is possible because there's lots of developing countries who sell their resources, Russia will have much less money. And if Western powers refuse to sell their high-tech products to Russia, Russian economy and standard of living will plunge even further.

Financial networks are just tools. Being able to send and receive money doesn't automatically mean that your economy will do great. And this is even ignoring the fact that sanctions are hard to bypass on practice, because very few companies want to risk it.

[KennyR]

Recovery of the economy won't happen all of the sudden through the backing of ruble by CBDC. Recently ruble saw good bounce from the price it fell during the rumours on ban of Russian Oil and gas into US. The economy of Russia is completely dependent on natural oil and gas industry. Already USA have stopped importing natural oil and gas from Russia. End of the year European nations were to stop it's import. But this isn't gonna happen, and if it happens then surely Russia will experience a big economic blow of atleast 20% In my view the economic recovery should happen out of the oil industry and Putin have alternate plans than just increasing the interest rates which will help sustain the economy for short term.

[||bit]

The Russia was the huge needed natio to many of countries by their Gas.Russia had the abundant source of Gas.They are tied with the natural resources of Gas.No other country had that much gas to replace the position of Russia.In a short period,may some country can supply of the Gas.While consider of a decade,it’s not possible for other country to act like that.

[Oceat]

They can do that but I don't think that they will. Although they've got a new rule that it's going to be Rubles that shall be used to pay for their commodities needed by other countries.
I guess that's already good enough for them not to make their own CBDC. But as they have already been aware about the potential of having their own crypto through CBDC, who knows what's on it for tomorrow.

Let's just wait and see then since we don't know yet what was Putin's been thinking on how to make their country survive from the western sanction. And I think forcing other countries to pay in Rubles instead of USD to sustain their economy. We don't know yet if creating CBDC is in their option but maybe they would choose the latter. Since they were selling commodities in exchange for Rubles I think there's a long term effect about that.

[be.open]

Ever since the US and its allies imposed economic sanctions on Russia, the country's been going downhill at a fast pace. Putin will have no choice but to look for other ways to help sustain the economy. He can either seek the help of China, back the Ruble with the value of a Bitcoin, or simply order Russia's Central Bank to create the new "digital Ruble". I think Putin will take the latter option in order to become impervious from sanctions in the long term. A digital Ruble living on its own blockchain network would be truly unstoppable. If other countries wanted to bring down Russia's economy, they would need to shut down the entire Internet to become successful (something that's largely impossible). Imagine if the new digital Ruble is launched as a sidechain to the main Bitcoin blockchain. It'll be as secure and censorship-resistant as Bitcoin is, greatly undermining the US Dollar's influence in the mainstream world.

Do you think economic sanctions will force Russia to create a CBDC of its own? If not, why? How do you think Russia's economy will fare in the next 5-10 years? Your input will be greatly appreciated. Thank you.

The prototype of the digital ruble platform was created in December 2021, and on February 15, 2022, testing began.

Now three banks from the pilot group have already connected to the platform. Two of them successfully completed a full cycle of digital ruble transfers between clients using banking mobile applications. Clients not only opened digital wallets on the digital ruble platform through a mobile application, but also exchanged non-cash rubles from their accounts for digital ones and then transferred digital rubles between themselves. The remaining participants in the pilot group plan to join the testing of the digital ruble platform as they complete their IT systems.

[Smartprofit]

I think that Russia will abandon its plans to create a digital ruble (CBDC). 

CBDC is a very controversial experiment, even in a situation far from a crisis.  Launching such an innovative project in the current situation is simply irrational.  It is impossible to calculate all the social and financial consequences of this decision. 

China is very clear about why it is creating a digital yuan.  The digital Chinese yuan is part of a digital ecosystem that allows you to control social, economic and financial processes.  The digital yuan makes no sense without the total computerization of society, without the development of isometry, a social rating system, five-year plans for industrial development, and expansion into Africa and Central Asia. 

Russia now has much more modest goals.  Russia is not in a position to set itself ambitious goals. 

The main goals of modern Russia are slowing down the process of technical and cultural degradation, maintaining a functioning infrastructure and preventing the collapse of the country.

[roadrunnerjaiv2025]

I think if you're going to start a war in this era, you'll have to be able to look at least 5 years into the future. Putin isn't stupid. He and his cronies knew this would happen and get worse over time. If they were afraid of the effects of these sanctions, they would have backed down from the get-go and tried a different approach. But they didn't, so they must have prepared for the worst. Also, they already had a taste of other countries' sanctions when they invaded Crimea so this isn't news to them. I wouldn't be surprised if releasing a digital coin has been considered in their plan, but I don't think that's going to happen anytime soon.

With oil prices skyrocketing, Russia is recovering faster than they are losing, which is one of the reasons we see ruble bouncing back. Once this war is over, the true losers of this war are the countries and private multinational companies that participated (or were forced to participate) in the sanction, because they lost a lot but didn't gain anything from it.

As for Russia, they might not be able to take over Ukraine completely, but they will have managed to topple down its government and cripple any plan of the US to put up nukes in their backyard. Russia is now using gold to evade the impact of the sanctions so there are more ways for Russia to survive than there are to murder its economy. They still hold a lot of aces to resort to having a DC. With Binance hopping on the sanction bandwagon, anything digital isn't appealing for those people. If it is and they've already made steps into its creation, it would still be centralized.