Russian lawmakers approve first reading of draft laws establishing CBDC regulation, issuance

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Accord­ing to local media reports, the Russ­ian State Duma approved draft laws estab­lish­ing a sys­tem to issue and reg­u­late cen­tral bank dig­i­tal cur­ren­cies (CBDC) in a first read­ing on March 16.

Addi­tion­al­ly, the Par­lia­ment approved the first read­ing of a bill that makes changes to the Russ­ian Civ­il Code and defines the dig­i­tal ruble as “non-cash mon­ey.” It also estab­lish­es rules around wal­let agree­ments and the inher­i­tance of dig­i­tal currency.

The two bills main­ly cov­er gaps in reg­u­la­tion stem­ming from the dig­i­tal­iza­tion of a currency.

Both bills will now go through a review process and be final­ized for a sec­ond read­ing based on feed­back from law­mak­ers. The sec­ond read­ing will take place in the com­ing months.

Personal data protection

The cur­rent ver­sion of the bill estab­lish­ing the CBDC sys­tem includes a pro­pos­al to change leg­is­la­tion and autho­rize the Russ­ian cen­tral bank — the issuer of the dig­i­tal ruble — author­i­ty to process the per­son­al data of users with­out consent.

How­ev­er, law­mak­ers dis­agree with the notion and believe that it would under­mine cit­i­zens’ right to per­son­al data pri­va­cy and protection.

The Par­lia­ment said it has instruct­ed the finan­cial mar­kets com­mit­tee to final­ize the draft laws for a sec­ond read­ing and ensure that per­son­al data will be pro­tect­ed appro­pri­ate­ly in the new dig­i­tal ruble system.

Digital ruble imminent

The draft laws estab­lish the cen­tral bank as the sole issuer of the dig­i­tal ruble and grant the reg­u­la­tor addi­tion­al pow­ers to ensure appro­pri­ate supervision.

Under the draft laws, the dig­i­tal ruble issued by the Russ­ian cen­tral bank will be deemed an offi­cial rep­re­sen­ta­tion of the country’s cur­ren­cy and will sim­i­lar­ly con­sid­er all for­eign dig­i­tal cur­ren­cies issued by a cen­tral bank to be offi­cial state currencies.

The leg­is­la­tion estab­lish­es a foun­da­tion­al frame­work for the dig­i­tal ruble, which includes set­ting up a plat­form that will issue the CBDC and devel­op­ing wal­lets for stor­ing it. The draft laws also define pro­ce­dures to access the plat­form and rules for participants.

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