September 22, 2023

National Bank of Ukraine reported to central banks about testing e-hryvnia

Representatives of ten central banks together with the National Bank of Ukraine (NBU) discussed development prospects digital currencies of the Central Bank (CBDC) and got acquainted with the results of testing e-hryvnia.

The event was attended by representatives of the central banks of Canada, Sweden, the Netherlands, Japan, Finland, Lithuania, Belarus, Uruguay and South Africa.

The Ukrainian regulator spoke about the results of testing digital hryvnia (e-hryvnia). As part of the pilot, a limited number of coins were issued in the amount of about five thousand hryvnias.

“The NBU’s vision is that the e-hryvnia is an electronic fiat currency that must be exchanged for cash or non-cash in the ratio 1: 1,” - emphasized in the National Bank.

Working groups tested the possibilities of creating andreplenishment of an electronic wallet and transfers through it. In turn, the NBU investigated the possibilities of blockchain technology for the release of CBDC, as well as the legal aspects of issuing e-hryvnia.

“If in the future the client feels the benefitsdigital currency, and this is primarily the speed and low cost of payments, he will continue to use this particular tool. At the same time, the demand for digital currency will stimulate the spread of operations with it, and market participants will develop infrastructure, ” noted the Deputy Director of the Department of Payment Systems and Innovative Development of the NBU Olga Vasileva.

The NBU report on a pilot project published inlast year, it is stated that "there are no fundamental advantages of using DLT technology to build a centralized system for issuing e-hryvnia."

Briefing note (e-hryvnia) by ForkLog on Scribd

According to CoinDesk, representatives of other central banks also expressed skepticism regarding the use of blockchain to issue CBDC.

“The essence of the DLT infrastructure is that no party should be fully trusted, but don’t we trust the central bank to maintain the integrity of the global distributed registry?” - said Harro Boven, political adviser to the payment policy department of the central bank of the Netherlands.

Nevertheless, the NBU still does not exclude the use of blockchain for issuing e-hryvnia.

“In 2020, there is no longer a question of whether to be a digital currency or not to be. This is already a given. The only question is who and how will create it, ”- noted the head of the National Bank, Jacob Smoliy.

At the moment, the NBU has suspended testing and expects further development of regulation of digital assets in Ukraine.

Earlier, ForkLog reported that at the conference, the NBU, together with Distributed Lab, introduced the MVP (minimally viable product) digital hryvnia system.

The news is being supplemented.