November 13, 2021

Russia to Launch Digital Ruble


Russia to Launch Digital Ruble
One ruble. Wikimedia Commons user Orange-kun

Russia is getting ready to test out the digital ruble, and it is not alone in launching a digital currency. But people who are not cryptocurrency enthusiasts want to know: What is a digital currency?

A digital version of a currency can be thought of as a third form of money: the first being cash, the second being non-cash (for instance, the money that gets direct-deposited into your bank account by your employer), and the third, for example, the digital ruble. The three types of currency are equivalent but probably difficult to understand. How is a digital ruble any different from a ruble direct-deposited by an employer?

The Russian Central Bank emphasizes that the digital ruble is not a cryptocurrency. Cryptocurrencies are decentralized (not issued by a government), and the identity of a holder is often impossible to determine unless the holder outs himself/herself. In contrast, the digital ruble will be held in electronic wallets "located" in the Central Bank.

Naturally, then, the digital ruble makes it easier for a government to track where all the money is going. Especially if people are not paying taxes on their under-the-table income (ahem). In many ways, digital currency is the opposite of cryptocurrency – though the idea and the digital infrastructure certainly came from that industry. One Russian blockchain and cryptocurrency expert says that the digital ruble will create the equivalent of the State Bank of the USSR. Another advantage of the digital ruble, according to Russian authorities, will be avoiding Western sanctions.

But this move is not limited to Russia. The United States and European Union are working on the digital dollar and euro, respectively, at the moment. China leads the pack, already using the digital yuan.

If you are thinking that cryptocurrencies are very prone to scams and hacks, and how is digital currency any different? – well, you're right. The fact is, the Russian government estimates it will need to spend R20-25 billion/$282.7 million (will those be cash or digital rubles?) to secure the system.

Many nations will have their digital currencies ready in the next 5-7 years. Russia had hoped to test the digital ruble in 2021, but with China already doing it, there is no hurry now. In fact, as Lenta.ru points out, watching other countries do it first can allow Russia to avoid all of their mistakes.

If you still do not quite understand how it will work... join the club. We guess we'll all find out soon.

You Might Also Like

Dirty Money
  • July 07, 2021

Dirty Money

“We are strengthening the protection of banknotes from the effects of harmful microorganisms.” – On July 5, Deputy Chairman of Russia’s Central Bank Mikhail Alekseev explained plans for the modernization of Russia’s bank notes
Coming Up Roses
  • March 19, 2021

Coming Up Roses

After one year of pandemic, Russia's economy is looking dandy while others are on the verge of collapse. Or so says new research.
Like this post? Get a weekly email digest + member-only deals

Some of Our Books

Driving Down Russia's Spine

Driving Down Russia's Spine

The story of the epic Spine of Russia trip, intertwining fascinating subject profiles with digressions into historical and cultural themes relevant to understanding modern Russia. 
Murder and the Muse

Murder and the Muse

KGB Chief Andropov has tapped Matyushkin to solve a brazen jewel heist from Picasso’s wife at the posh Metropole Hotel. But when the case bleeds over into murder, machinations, and international intrigue, not everyone is eager to see where the clues might lead.
Fearful Majesty

Fearful Majesty

This acclaimed biography of one of Russia’s most important and tyrannical rulers is not only a rich, readable biography, it is also surprisingly timely, revealing how many of the issues Russia faces today have their roots in Ivan’s reign.
A Taste of Chekhov

A Taste of Chekhov

This compact volume is an introduction to the works of Chekhov the master storyteller, via nine stories spanning the last twenty years of his life.
Dostoyevsky Bilingual

Dostoyevsky Bilingual

Bilingual series of short, lesser known, but highly significant works that show the traditional view of Dostoyevsky as a dour, intense, philosophical writer to be unnecessarily one-sided. 
Marooned in Moscow

Marooned in Moscow

This gripping autobiography plays out against the backdrop of Russia's bloody Civil War, and was one of the first Western eyewitness accounts of life in post-revolutionary Russia. Marooned in Moscow provides a fascinating account of one woman's entry into war-torn Russia in early 1920, first-person impressions of many in the top Soviet leadership, and accounts of the author's increasingly dangerous work as a journalist and spy, to say nothing of her work on behalf of prisoners, her two arrests, and her eventual ten-month-long imprisonment, including in the infamous Lubyanka prison. It is a veritable encyclopedia of life in Russia in the early 1920s.
Life Stories: Original Fiction By Russian Authors

Life Stories: Original Fiction By Russian Authors

The Life Stories collection is a nice introduction to contemporary Russian fiction: many of the 19 authors featured here have won major Russian literary prizes and/or become bestsellers. These are life-affirming stories of love, family, hope, rebirth, mystery and imagination, masterfully translated by some of the best Russian-English translators working today. The selections reassert the power of Russian literature to affect readers of all cultures in profound and lasting ways. Best of all, 100% of the profits from the sale of this book are going to benefit Russian hospice—not-for-profit care for fellow human beings who are nearing the end of their own life stories.
Murder at the Dacha

Murder at the Dacha

Senior Lieutenant Pavel Matyushkin has a problem. Several, actually. Not the least of them is the fact that a powerful Soviet boss has been murdered, and Matyushkin's surly commander has given him an unreasonably short time frame to close the case.
93 Untranslatable Russian Words

93 Untranslatable Russian Words

Every language has concepts, ideas, words and idioms that are nearly impossible to translate into another language. This book looks at nearly 100 such Russian words and offers paths to their understanding and translation by way of examples from literature and everyday life. Difficult to translate words and concepts are introduced with dictionary definitions, then elucidated with citations from literature, speech and prose, helping the student of Russian comprehend the word/concept in context.
Turgenev Bilingual

Turgenev Bilingual

A sampling of Ivan Turgenev's masterful short stories, plays, novellas and novels. Bilingual, with English and accented Russian texts running side by side on adjoining pages.
Bears in the Caviar

Bears in the Caviar

Bears in the Caviar is a hilarious and insightful memoir by a diplomat who was “present at the creation” of US-Soviet relations. Charles Thayer headed off to Russia in 1933, calculating that if he could just learn Russian and be on the spot when the US and USSR established relations, he could make himself indispensable and start a career in the foreign service. Remarkably, he pulled it of.
The Frogs Who Begged for a Tsar (bilingual)

The Frogs Who Begged for a Tsar (bilingual)

The fables of Ivan Krylov are rich fonts of Russian cultural wisdom and experience – reading and understanding them is vital to grasping the Russian worldview. This new edition of 62 of Krylov’s tales presents them side-by-side in English and Russian. The wonderfully lyrical translations by Lydia Razran Stone are accompanied by original, whimsical color illustrations by Katya Korobkina.

About Us

Russian Life is a publication of a 30-year-young, award-winning publishing house that creates a bimonthly magazine, books, maps, and other products for Russophiles the world over.

Latest Posts

Our Contacts

Russian Life
73 Main Street, Suite 402
Montpelier VT 05602

802-223-4955