According to the Central Bank of Russia, the development of digital currencies may challenge the SWIFT international banking payment system and could eventually make it redundant, as reported by Russia Today. More than 30 financial regulators are currently working on their national digital currencies, according to the First Deputy Governor of the Russian central bank, Olga Skorobogatova. Given the pace of digital currencies’ development, several countries may launch the new form of currencies over the next 5-7 years, the official added.
Digital currencies may challenge SWIFT payment network.
Deputy Governor of the CBR, Olga Skorobogatova, said, “Then we can deal with direct integration issues. In this case, SWIFT may not be necessary because it will be a different kind of technological interaction.” However, the global banking network may become one of the platforms for the new form of national currencies, she added. The SWIFT (The Society for Worldwide Interbank Financial Telecommunication) system facilitates cross-border payments between 11,000 financial institutions in more than 200 countries worldwide. However, some Western politicians have threatened to disconnect Russian banks from the network as part of broader sanctions.
Russia is currently developing a digital ruble.
According to the Russia Today report, Russia’s financial watchdog is currently developing a digital ruble. The new form of the Russian currency, which is supposed to exist along with cash and non-cash rubles, is to be test-launched as soon as next year in the Crimea. Earlier this year, Russia’s central bank said that the digital ruble might be used for international money transfers, but only after its global peers establish their sovereign digital currencies. As reported earlier, at least 36 central banks have published studies on the Central Bank Digital Currency (CBDC) as of July this year, according to the Bank for International Settlements (BIS).