Blockchain News

Ukraine Passes Law Enabling Creation of Central Bank Digital Currency

With the most crypto adoption globally, Ukraine can become an ideal test subject for implementation.

Law Finally Signed

Ukraine has greenlit a digital version of their hryvnia currency, as another country has pivoted to central bank digital currency (CBDC). Ukraine’s parliamentary body, the Verkhovna Rada, passed the law ‘On Payment Services’ in June, and President Zelenskyy finally inked the bill on Thursday, July 29. 

Ukraine has flirted with a digital currency since 2018, and the country has widespread crypto adoption in its country–– the highest adoption in the world, according to the Chainanlysis’ 2020 Geography report. The new law does not spell out adopting a digital currency but begins the steps for general principles for operation.

”Determines the general principles for the functioning of payment systems in Ukraine, the issue and use of electronic money and digital money by the NBU,” read the official announcement from the Information Department of the Verkhovna Rada of the Ukrainian Secretariat.
Source

World Becoming Digital

Many countries––including the world’s two most populous countries, India and China––have begun working on a CBDC. Alongside Ukraine in Europe, France, Sweden, and the European Union are also working to implement CBDCs. Digitized currency grows more and more each day, with more countries acknowledging their potential for radical change. 

Ukraine has already taken other formal steps to prepare a CBDC. The Ministry of Digital Transformation tested a prototype on the Stellar Lumens blockchain earlier this year. It appears Stellar will work with the National Bank of Ukraine (NBU) to digitalize the hryvnia.

The country seeks to become a hotbed of cryptocurrency in the world to help improve its embattled economy. The peculiar geopolitical situation of the country and the need to combat corruption make the safety and security of the digitalized hryvnia very important for Ukraine. 

Hopefully, the NBU can instill public confidence in the central bank and its financial services. Ukraine presents the potential for a positive use case in CBDC adoption.

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