Russia pushes retirees into a "digital ruble trap"

 

Russia 

pushes retirees into a "digital ruble trap"

According to a Russian economist, the Russian government is expected to

 eventually force retirees in the country to receive their payments by digital ruble.

as part of its efforts to increase the adoption

 of the Central Bank's digital currency (CBDC).

Russia began its CBDC 

pilot project last August after President Vladimir Putin

 approved the Digital Ruble Act.

According to

 a source at the Bank of Russia

The planned pilot programme could run until 2025 and include 

phases that bring together new banks and technical partners at each stage.

One of the Russians' 

main concerns was that the government might 

impose on them the use of central bank digital currencies (CBDC)

but the central bank has consistently denied this claim.

According to Russian economist Alexander Razovaev

retirees will be the first group targeted by this move.

Retirement payments will gradually be replaced by digital ruble. 

This development is likely to force Russians to accept the digital 

ruble in the near future.

So, little by little

retirees fall into the central bank trap

 and are encouraged to turn into a new kind of money.

He added that this trend "will only increase over time. 

Technological progress has an impact. "

The Russian government restored an explanation on the digital ruble 

and its mandatory use, after worrying the Russians when it was announced 

by the Central Bank a few years ago.

And in August

The Federation of Russian Banks has demanded the adoption of formal laws to

 prevent the mandatory use of the central bank's digital currency.

Anti-cryptocurrency activists exploited the source of concern as

 a platform for their opposition to the digital ruble.

But the Bank of 

Russia confirmed that the use of digital ruble 

would be optional even for retirees.

The President of the Bank

Elvira Nabiolina

stated:

 "The Central Bank only calls for the voluntary transfer of

 pensions to the digital ruble.

People should remember how pensions were converted into an MIR card

where people had an option - to receive the pension in cash

by mail or deposit it in their account. "

The MIR Card is a payment system developed by the Central

 Bank and currently operates in more than 12 countries.

For Russians

 worry about compulsory digital ruble

Despite pledges

Russians remained wary of imposing digital ruble on them.

Some lawmakers' statements did not help allay concerns, with Anatoly Aksakov

 chairman of the Duma Committee on Financial Markets

claiming that

 the central bank's digital currency could be programmable.

Aksakov stated that digital ruble can be allocated for specific uses 

and prevented from other uses, for example, parents can program a CBDC 

account to reject drug or alcohol payments to their children.

Aksakov acknowledged that citizens' concerns were justified

but stressed that the Bank of Russia did not express its desire to

 use the digital currency of the central bank to control people.

Nevertheless, he acknowledged that the State might intervene in the process

 although they had not yet advanced this procedure by using the digital ruble.

The use of central bank cryptocurrencies (CBDC) 

has been an ongoing concern globally. In the European Union

Individual States expressed similar concerns; Slovakia amended

 its Constitution to protect access to cash;

In response to

 concerns that the ECB

 could force Slovaks to use regional digital currency.

Regardless of international concerns, digital ruble poses 

a major challenge to the traditional banking industry

Aksakov revealed the central bank's plans to provide retail services to Russians

 through the central bank's digital currency, which could overtake commercial

 banks and threaten a $1.5 trillion industry.