Minsk is looking for ways to end Belarus’ sanctions woes, with its central bank confirming the planned launch of a blockchain-powered CBDC.
Per Sputnik Belarus, the National Bank of Belarus (NBB) is keen to make use of smart contract technology. A spokesperson told reporters on February 3:
“We plan to classify settlements using the digital Belarusian ruble as non-cash transactions.”
Will Minsk’s CBDC Prove a Belarus Sanctions Tonic?
The bank has already revealed plans to build its CBDC on the Hyperledger Fabric blockchain protocol.
The NBB added that the coin will be named the digital Belarusian ruble (DBR). And the bank confirmed that the token will use “distributed ledger technology, also known as blockchain.”
The bank claimed that the CBDC will provide citizens with “several advantages,” including a “high level of safety” for the general public.
However, the nation’s trading firms have suffered from Western-led sanctions imposed by Washington, Brussels, and their allies following the outbreak of war in Ukraine.
Since February 2022, Belarusian firms have been contending with sanctions that effectively freeze them out of most dollar-powered trade.
Ukraine held mock anti-sabotage drills at the Belarus border as Ukrainian soldiers say they face an enemy with greater forces and more men https://t.co/myb6lzKDwN pic.twitter.com/gua4NvRvhN
— Reuters (@Reuters) January 18, 2024
Sputnik Belarus added that “for the Belarusian state,” the CBDC would “expand possibilities for integrating the national payment system with the systems of partner countries.”
Minsk’s closest allies, Moscow and Astana, have also accelerated their own CBDC plans. Both Russian and Belarusian leaders have talked of launching CBDC-powered trade in the CIS.
The nations envisage a network of interoperable CBDCs that allow traders in each country to buy and sell goods.
They think this would remove the need for banking networks like SWIFT or currencies like the US dollar.
Pavel Kallaur, Chairman of the board of directors of the National Bank of the Republic of Belarus, speaking to reporters in 2023. (Source: Belarus RTR/YouTube)
Smart Contracts: Belarus Eyes Blockchain Progress?
The NBB concluded that “businesses and [commercial] banks” would also have much to gain from the CBDC launch.
The bank explained that a digital fiat would help “lower the barrier of entry for new market participants.” And the bank said that “using smart contracts” would be key to this.
In China, banks are using CBDC smart contracts to provide financing and subsidies to small businesses.
Russian ministers have also suggested they want to trial the use of CBDC-powered government subsidies in 2024.
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