In a recent event, the Russian prosecutor-general urged international cooperation on regulation of central bank digital currencies (CBDCs). In particular, the prosecutor-general said that Russian and Chinese central banks must cooperate on CBDC regulation.
According to local media reports, Igor Krasnov, Russian Prosecutor-General, said that the intended cooperation would be in the “common interest” of both Moscow and Beijing as it will help to create a legal system that could prevent criminals from abusing their CBDCs.
The recent comment from the Krasnov came during a meeting in Beijing with his counterpart Ying Yong, the Prosecutor-General of the Chinese Supreme People’s Prosecutor’s Office. Talking about China’s fast paced advancement in the CBDC journey, Krasnov said:
China was one of the first nations in the world to introduce a CBDC [partly] in order to protect the economy from the criminal influence of cryptocurrencies.
Furthermore, the Russian prosecution chief expressed his hopes from the cooperation on the CBDC regulation. He stated that such exchange of information between nations will be incredibly helpful in protection of masses from criminal influence.
I believe that the exchange of information about [our digital currencies], legal regulation, and the protection [of the CBDCs] from criminal influence would be of common interest to our prosecutorial services.
In his speech, Krasnov also highlighted the fact that the State Duma had i.e. the Russian parliament approved the CBDC law, with most of its provisions coming into effect on August 1. However, a number of its clauses will come into force “at a later date” as suggested by some internal sources.
Reportedly, the CBDC law also includes provisions that allow “non-residents” of Russia to open wallets upon the allowance from central bank. This suggests that Russian authorities are looking to use its digital Ruble as a tool of international trade right from the outset.
While both the nations are at very different stages of their respective CBDC development, the intended cooperation is to strengthen the cross border transactions angle of CBDCs.
Notably, Russia is into the very initial phases of CBDC development and the central bank has recently initiated the pilot whereas China is at a much later stage and is taking several steps to foster CBDC adoption. After several giveaways and integration of digital Yuan into mobile payment applications, Chinese authorities are now working on an offline CBDC through super SIM cards and social security cards.
It is important to note that as Russia intends to use its digital Ruble efficiencntly for cross-border settlements, recent comments aim in the direction. However, interestingly it is not the same stance that the People Bank of China (PBoC) originally claimed that the digital Yuan was being developed exclusively for domestic use.
Nonetheless, it is not shocking considering the global rising interest in CBDCs from various nations as well as some international agencies. Additionally, in recent months, the PBoC has changed its tune somewhat and the officials have begun talking up the “cross-border” credentials of the digital Yuan.