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How Russia could benefit from and is considering Digital Assets

Jonny Fry
3 min readJun 22, 2019

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The Chair of Russia’s Central Bank, Elvira Nabiullina, has admitted that various central banks are investigating the possibility of issuing a Central Bank-backed Digital Currency. The general stance in Russia towards Digital Currencies seems to be softening, as it had been very anti these assets. It was only just last week in Russia the Central Bank admitted that it would consider using a Cryptocurrency, backed by gold, for international settlements. Russia currently holds over $492 billion of gold which, if Digitised, some could be used to settle outstanding international debts and be a way around the economic sanctions Russia is subject to.

More and more governments are looking at Digital Currencies as a way to create more transparency, so minimising their “black economy” and, by using Smart Contracts, they could offer the potential to introduce automatic collection of taxes — which would be faster and potentially more efficient for revenue authorities.

Interestingly, Russia has a lot to gain from embracing Digital Assets as it is a big producer of commodities. These assets typically only trade for a few hours a day and only 5 days a week. A Digital Asset pegged to different commodities could help reduce the volatility of these commodities, and provide an alternative way for Russian companies to raise capital, so getting around the afore-mentioned sanctions. InGermany, BSAF’s new electric car battery factory, which has been built to use commodities such as palladium and produced by Nornickel(the huge Russian commodity miner), would potentially benefit from Digital Assets. These Digital Assets could allow Nornickel to raise capital and potentially avoid sanctions should Nornickel sell, say, a Digital Asset pegged to palladium.

Anything that can reduce the costs of trading in commodities has to be welcome, and such Digital Assets could offer an interesting New Asset class for investors, as well as creating potentially greater liquidity and low commodity volatility for existing institutions.

Indeed there had been some reports, in February 2019, that Russia would develop an oil- backed Cryptocurrency.

More recently, on the back of the announcement from Facebook about its new Libra Digital currency, Russia has said that it will not legalise Libra.In an interview with local radio station Kommersant FM, Anatoly Aksakov, Chairman of the Russian State Duma Committee on Financial Markets…

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Jonny Fry
Jonny Fry

Written by Jonny Fry

#DigitalAssets#Tokens #ClearBank #ChairmanGemCap #Fintech #Blockchain #Assetmanager #Speaker #DigitalBytes #TURN @Teamblockchain Twitter:@jonnyfry175

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