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Ethereum-Based ‘Cryptoruble’ Token Under Development in Russia

Ethereum-Based ‘Cryptoruble’ Token Under Development in Russia

Developers are working on a “cryptoruble” that, as they say, can improve Russians’ access to global exchanges and be used for cross-border payments. Defi platform Indefibank, which is behind the project, says the token will be pegged to the national fiat but independent from a state-issued digital ruble.

Cryptoruble to Give Russian Companies Another Option for International Settlements

Work is underway in Russia to launch a “tokenized cryptoruble” on the Ethereum blockchain, the CEO of decentralized finance (defi) banking platform Indefibank, Sergey Mendeleev, announced during the Blockchain Life 2022 conference.

The plan is to issue the token through a decentralized smart contract with excess collateral, or based on the model employed by the DAI stablecoin, the executive explained. Its exchange rate with the Russian ruble will be 1:1. Quoted by the crypto news outlet Forklog, Mendeleev detailed:

A user can either independently issue a cryptoruble by placing sufficient collateral in the form of stablecoins or cryptocurrency on the balance of a smart contract, or purchase it from an authorized exchanger for fiat.

The total supply will directly depend on the amount in collateral. Indefibank estimates the size of the potential market among private individuals at between 5 and 10 billion rubles (approximately $82 – $160 million).

The cryptoruble developers expect other members of the crypto community to join the initiative and see the project becoming an independent decentralized autonomous organization (DAO) in the future. The cryptoruble will be a payment tool unrelated to the central bank digital currency (CBDC) created by the Bank of Russia.

Russia’s central bank, which recently agreed that the country would need cryptocurrencies to circumvent sanctions, vowed to promote its digital ruble in foreign trade. The regulator also made it clear discussions are not about allowing domestic crypto payments and expressed doubts about the need to legalize private digital currencies.

Indefibank’s CEO noted that Russian law does not require the establishment of a DAO and the issuance of ERC20 tokens to be coordinated with the central bank. However, if the monetary authority objects to the use of the word “ruble,” the company is ready to change the name of the crypto.

The cryptoruble will make it easier for Russians to access global exchanges and settle with foreign partners, Mendeleev insisted. The token’s developers have already prepared an MVP, the report reveals, with the presentation of the final product expected in October.

Do you think the Bank of Russia will allow currencies like the cryptoruble to be used in foreign trade deals? Tell us in the comments section below.

Lubomir Tassev

Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens’s quote: “Being a writer is what I am, rather than what I do.” Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.

Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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Value Locked in Defi Nears $100 Billion Milestone Amidst Broad Market Uptick and Lido Dominance

Five days ago, the total value locked (TVL) in decentralized finance (defi) protocols exceeded the $80 billion mark, and since that point, it has expanded by an additional $11.66 billion. As it hovers above the $91 billion threshold, the TVL is approaching the $100 billion milestone…
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I Am Hip Hop TV Redefines Digital Media Distribution Landscape

PRESS RELEASE. February 16, 2024 – I Am Hip Hop TV, a pioneering startup dedicated to revolutionizing digital media distribution, announces its strategic approach to enhancing brand visibility and driving engagement across major social media platforms. With a focus on inciting meaningful user interaction that translates into increased awareness and sales conversions…
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Bank Protests and Holdups Continue to Rise in Lebanon, as Depositors Demand Savings

Bank Holdups and Protests Continue to Rise in Lebanon as Depositors Demand Their Own Savings

On Dec. 17, reports detail that residents in Lebanon have been staging sit-ins and protests at banks in order to access their own savings accounts. Since the economic collapse in 2019, Lebanon’s banks froze Lebanese bank accounts, and a number of branches have remained closed indefinitely. Although a few Lebanese have been forced to fork over their savings, most of the residents have fled or been arrested without any money.

Lebanon Banks Respond to Protests and Gunpoint Requests from People Wanting Their Savings Back

In August 2019, it became apparent to the world that Lebanon was suffering from a liquidity crisis, and there have been many reports that say financial coverups and U.S. sanctions put Lebanon’s economy in a vice grip. It has been reported that by late 2018, a handful of Lebanese commercial banks froze people’s accounts and by the first week of March 2020, Lebanon said it would default on its Eurobond debt.

The country began seeking restructuring agreements. However, Lebanon’s lira rate diverged from the black market rate in August . A report published in August 2022 details that the “black market rate is what the currency is actually worth now.” In June 2022, Bitcoin.com News reported on Lebanon’s inflation rate surging to 211% which highlighted the economist Steve Hanke, who said the country should leverage a currency board.

Bank Holdups and Protests Continue to Rise in Lebanon as Depositors Demand Their Own Savings
Lebanese soldiers who are still able to make a living as enforcers protect Lebanon’s central bank and current politicians.

On Dec. 17, NPR columnist Ruth Sherlock described how poverty-stricken Lebanese have been outside of banks protesting in order to get access to their own savings accounts. In Tripoli, Lebanon at an IBL Bank branch, Sherlock said a 53-year-old woman named Zahra Khaled sat in a wheelchair and would not leave the bank until the staff gave up her life savings. Sherlock reports that Khaled said the bank had frozen “tens of thousand dollars”.

Sherlock explains that Khaled’s protest was “one of the gentler tactics” and that some are using real or toy guns in order to recover their money. The NPR reporter does note that some Lebanese who resort to this tactic only want “what they are owed.” Countless reports, littered all over the internet, confirm Sherlock’s account that says Lebanese bank accounts have been frozen since 2019, since the onset of Lebanon’s economic collapse. In 2020, angry depositors and protests got so bad that the commercial banks armored the fronts of specific branch buildings with steel and cement walls.

Reuters reported in Sept. 2022 that “bank holdups snowball in Lebanon as depositors demand their own money,” as these types of acts have become a normal occurrence in the country. Reuters elaborated that five depositors held up banks in order to access their own funds and some depositors managed to get around $60K, while some people were taken into custody. In Nov. 2022, Al Jazeera detailed that banks in Lebanon reopened for two weeks. Al Jazeera was told by a Lebanese photographer that he had been waiting for a cheque to be cashed for over two weeks.

Sherlock’s reports stated that Khaled had negotiated for hours with the bank staff but they eventually left. Khaled was then taken out by the Internal Security Forces, Lebanese police who are also known as the ISF. Lebanese depositors have protested at banks such as Bank Audi, IBL Bank and Blom Bank. On Dec. 16, Reuters reported that a U.S. court of appeals has decided that Lebanese commercial banks can be tried outside Lebanon.

What do you think about Sherlock’s report that says Lebanese citizens are resorting to trying to get their funds at gunpoint and assembling protests in front of Lebanon’s commercial banks? Please comment below to let us know your thoughts on this topic.

Jamie Redman

Jamie Redman, the News Lead at Bitcoin.com News, is a Florida-based financial journalist. Redman has been an active member of the cryptocurrency community since 2011. Redman is passionate about Bitcoin, open-source codes, and decentralized applications. Since September 2015, Redman has written more than 6,000 articles for Bitcoin.com News about the disruptive protocols emerging today.

Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. This article is not intended to be a solicitation or offer to buy or sell any products or services. Bitcoin.com does not provide investment, tax, legal, or accounting advice. The author and the company are not responsible for any loss or damage resulting from or in connection to the content, goods, or services discussed in this article.

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