Russia Central Bank Likely to Introduce Gold-Backed Cryptocurrency

The central bank of Russia has recently said that they are likely to introduce a gold-backed cryptocurrency to facilitate international settlements.

While speaking at the State Duma this Thursday, May 24, Russia’s central bank governor Elvira Nabiullina said “When it comes to international payments, we will of course consider [the] proposal … of gold-backed cryptocurrency. But, in my opinion, it is more important to advance payments in national currencies”.

Governor Nabiullina also said that the central bank is currently reviewing the proposal for the development of the gold-backed cryptocurrency. However, she also added that fiat currency settlements within the Eurasian Economic Union are continuously improving with “good dynamics”.

Russia has been having a whimsical stand when it comes to cryptocurrencies or state-sponsored digital currencies. In the last few years, there have been several plans made and dissolved with the most popular being the ‘Cryptoruble’ a stable coin backed with the Russian fiat currency.

However, it sees that the Bank of Russia itself seems to be less keen on introducing a stable coin in the Russian financial system. Governor Nabiullina added that cryptocurrency currently holds a little perspective even within the frames of its regulatory sandbox.

“We don’t see a possibility for cryptocurrency to fulfil the role of a money surrogate… and are practically not considering it within the context of the regulatory sandbox,” she added.

In the past, Russia has promised to bring clear regulations for the functioning go digital currencies. However, a majority of its plans have stayed opaque.

Some reports earlier this year also suggest that Russia has been quietly accumulating Bitcoin to overcome the U.S. sanctions. Russian economist Vladislav Ginko stated that his country could possibly invest $10 billion in Bitcoin reserves.

Mr. Ginko said: “[The] Russian government is about to make a step to start diversifying financial reserves into Bitcoin since Russia [is] forced by US sanctions to dump US Treasury bonds and [take] back US dollars”.

He further added: “These sanctions and the will to adopt modern financial technologies lead Russia to the way of investing its reserves into Bitcoin.”