October 18, 2020 / banks

Digital Ruble And Crypto Yuan Seems As The Government’s Plan to Pocket Money


Central Bank of Russia presented the project of the digital ruble, also called the crypto ruble. There are many rave reviews online. They mainly discuss how digital ruble will make payments safer, faster, and cheaper. And most importantly, now Russia will not be afraid of any sanctions, including disconnection from SWIFT.

But the truth is that the digital ruble will not only improve payments, but it will actually pocket money transferring it to the state. Then the Central Bank of Russia can do whatever it wants with your money.

Crypto Yuan

We will start with China because it is the Celestial Empire that is the most advanced country in the development of its own national digital currency. The official reason is to make payments safe, that is, contactless. And the coronavirus has helped states to more actively encourage people to switch to non-cash payment methods. The second reason is revolutionizing payments and finally, oust US dollar as the world’s reserve currency.

Do you know what these two reasons have in common? The fact that they are completely contrived and have no connection with reality. There are a huge number of contactless payment methods. In China, many have not carried wallets for a long time and buy everything through the payment system of the WeChat messenger.

As for domestic settlements in digital currency, its very concept implies centralized use, when the main server is located in the building of the Central Bank. That is, if a country wants to add a crypto yuan to its reserves, it will not actually own it, they will simply create an electronic record on the server of PBOC.

A compromise can be the use of a decentralized ledger and the creation of equal rights for all participants in the system.

But the PBOC has made it clear that only they will have the only control over the digital yuan and the completeness of information about all payments. Therefore, no adequate state will agree to cooperate on such conditions.

Then why do we need a digital yuan? This effort is similar to the social credit system. For reference: this is a platform that analyzes data about people from various sources of information, and if you have a bad social rating, then you will be limited in your rights.

This can be a refusal to issue a loan, where, in fact, is the name, a refusal to hire, a ban on traveling abroad, and other problems. There is even a clause that children of unreliable parents may be banned from studying at a prestigious school. That is, if you want a good future for your children, work hard for the state to have a good opinion of you.

And if officially this system was promoted as control over unscrupulous citizens who committed offenses and did not pay on loans, now you can get under its supervision for such things as a refusal to perform public works or criticism of the authorities on social networks. We think you understand: do not speak badly about power, or your children will go to a bad school.

And the digital yuan is becoming a logical continuation of this total control system for the formation of a digital Chinese concentration camp. Because it is problematic to track cash, payments using payment systems can be controlled, but this requires a lot of resources.
But the crypto yuan will give out all the information about the user at any time and it will be at the disposal of the state without any intermediaries.

By the way, the crypto yuan has already appeared and the first emission was carried out among the population. And if someone thinks that the digital ruble is being created in Russia for other purposes, then he is deeply mistaken.

Crypto Ruble

Let’s talk specifically about the digital ruble. The first rumors about him appeared back in 2018, when the topic with state digital currencies surfaced in general, and also the State Duma deputies were sharply concerned with the problem of cryptocurrency regulation.

Further, the chronology of events was as follows. The concept that was presented for the crypto-ruble was originally one-on-one as Sberbank-online, only the application will be managed by the Central Bank.

But this topic somehow faded into the background, and we talked more about the regulation of cryptocurrencies, which, despite the calls of Vladimir Putin and Dmitry Medvedev, could not get off the ground until this year. It was only in the summer of 2020 that the Law on Digital Financial Assets was finally passed, which was a huge disappointment.

The thing is that the so-called digital assets are something that will be issued under the supervision of the Central Bank, and all transactions with them will also take place under its close control.

But cryptocurrencies, according to this law, are prohibited as a means of payment. Moreover, from January 1, 2021, the media will be prohibited from disseminating information about the use of bitcoin and other cryptocurrencies to pay for goods and services.

As for the digital ruble. Central Bank’s note the concept completely copied the basic principles from the Chinese digital yuan.

The full version of the digital ruble can be found on the Central Bank of Russia website here.

Thus, the crypto ruble is another form of money on a par with cash and non-cash funds in national currency, the only difference is that it has its own payment system, which is served by the Central Bank server.


Some blogger experts are now saying that the digital ruble is the future of money. That now there will be no need to spend money on the issue of coins and banknotes, and less expenses is always good. That now we will not depend on the bank payment system, in addition, we will not be afraid of any threats from Visa, Mastercard and even disconnecting from SWIFT is now complete garbage. In general, money will become more convenient, reliable, and cheaper.

Note that this system is primarily for interbank international payments. And you need to understand that the digital ruble will only support the tokenized analog of the ruble, that is, payments in other currencies are not available to this system. Well, and as you perfectly understand, the second party must agree to use the crypto ruble. Why would they do that?

Of course, digital ruble has its advantages. If you give this money to a child for school lunches, then it will be problematic to buy cigarettes for it. But the downside is that all your funds are under constant control and actually belong to the Central Bank.

We can conclude, that citizens’ money is held hostage by the state. And if you start converting them into cash, you will immediately fall into the field of view of tax authorities and other services. You never know what you do there with paper Russian rubles, or buy US dollars, or finance which prohibited organizations. Suspicious in general, which means that you need to be monitored.

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