Bank of Russia May Allow Russian Banks to Use Blockchain Technology

The Bank of Russia’s working group on blockchain and fintech technologies – which was formed in February of this year – will be presenting their findings in June.

Olga Skorobogatova, Deputy Governor of the Bank of Russia and head of the fintech working group, has previously said that global financial innovation will have material impacts the Russian financial system.

According to a report by Russian news service Izvestia, the working group has found that blockchain technology may dramatically improve transparency and security within Russia’s banking system.

A source close to the Bank of Russia has confirmed that the central bank is considering letting Russian banks to begin storing transactions on a blockchain-based system. The source also stated that any potential issues and complications with the technology need to be resolved by the end of this year.

The translation reads:

“if the issue is not solved with the application of technology to the end of 2016, banks have to cool interest in the technology: then it will be inappropriate to further study.”

Robert Bagratuni, former marketing specialist at Mail.Ru Group as well as founder of mobile stock trading platform Source, said that Russia’s banking system needs to move quickly on this technology, otherwise they will be left behind, “if ​​Russian banks will not work with blockchain technology, they just lag behind their foreign competitors.” said Bagratuni.

Furthermore, Bagratuni explained that distributed ledgers and blockchains, if properly implemented, may eliminated a lot of “fraudulent schemes” and corruption within Russia’s financial system, “If the Central Bank does not allow the financial institutions to work with this technology, the Russian banking system in the long term can be quite vulnerable.” he adds.

 

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