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Ukraine Considering CBDC That Can Facilitate Crypto Trading

Ukraine Considering CBDC That Can Facilitate Crypto Trading

Ukraine Considering CBDC That Can Facilitate Crypto Trading

The National Bank of Ukraine says it is looking at retail payments, virtual asset circulation and cross-border transactions as possible use cases for an electronic hryvnia.

The National Bank of Ukraine says it is looking at retail payments, virtual asset circulation and cross-border transactions as possible use cases for an electronic hryvnia.

The National Bank of Ukraine says it is looking at retail payments, virtual asset circulation and cross-border transactions as possible use cases for an electronic hryvnia.

AccessTimeIconNov 29, 2022, 11:29 AM
Updated Nov 29, 2022, 3:16 PM
Ukraine is exploring an electronic version of its currency. (Max Kukurudziak/Unsplash)

The National Bank of Ukraine is considering an electronic version of the Ukrainian hryvnia that would be able to facilitate the exchange and issuance of virtual assets, among other uses.

The central bank has discussed its vision for an electronic iteration of the country's sovereign currency, the hryvnia, with representatives of banks, non-banking financial institutions and the crypto market, according to an official press release on Monday. The bank is exploring retail non-cash payments, virtual asset circulation and cross-border transactions as possible applications for a CBDC.

"E-hryvnia can become one of the key elements of qualitative infrastructure development for the virtual-assets market in Ukraine," the report said.

Ukraine has been looking into a CBDC since 2017, and is one of more than 100 jurisdictions around the world exploring a national digital currency. In July 2021, President Volodymyr Zelensky signed into law a bill to allow the central bank to issue a CBDC that can be grouped in the same category as cash or electronic money.

Last December, Tascombank, one of the country's oldest commercial banks, revealed plans to test an electronic hryvnia built on the Stellar network.

Crypto came to play a role in collecting donations and facilitating the purchase of critical supplies after Russia's invasion of the country in February.

The central bank said it "continues to develop" the "e-hryvnia" project with market participants and state bodies.

"At the same time, the National Bank, like most central banks of the world, will approach the issue of issuing its own digital currency carefully and taking into account, in particular, the potential impact of its introduction on the financial system of the state," the report said.

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Sandali Handagama is CoinDesk's deputy managing editor for policy and regulations, EMEA. She does not own any crypto.