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Putin Bans Digital Assets as Payments While Granting Legal Tender to Digital Ruble

Putin Bans Digital Assets as Payments While Granting Legal Tender to Digital Ruble

Putin Approved a Bill That Makes the “Digital Ruble” Legal Tender

Russian President Vladimir Putin has signed a bill into law that forbids the use of digital financial assets as payment for goods and services.

A portion of an existing federal legislation on banks and banking activities is suspended by the bill, which was presented to the lower chamber of Parliament in June. As a result, it is now forbidden for people to use cryptocurrencies as payment methods.

As part of the national payments system, the bill also established the idea of an “electronic platform” where digital financial assets are issued and transactions and acts are likely to be submitted to the Russian central bank’s registry.

This comes as Putin approved a bill that makes the “digital ruble” legal tender. The measure also describes how banks would function under the new framework and offers legal definitions for users.

The central bank of Russia has been appointed to act as the platform operator for the central bank digital currency (CBDC). However, it won’t likely be until 2025 at the earliest that the majority of people have access to online wallets.

In contrast to a cryptocurrency like Bitcoin, the digital ruble is a centralized token with a value correlated to the national fiat currency. The measure was passed in the midst of harsh Western sanctions and soaring inflation spurred on by the war in Ukraine The central bank has said that loans or deposits cannot be made using the CBDC, and only payments or transfers are permitted.

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