The Central Bank of the Russian Federation presented a report on the tokenization of non-cash money

issuance of tsfa (tokens with various collateral) in the Russian Federation 2
issuance of tsfa (tokens with various collateral) in the Russian Federation 2

The Bank of Russia presented a report in which it collected the results of an international discussion on the issue of tokenization of non-cash funds.

Potential benefits from the introduction of new payment instruments are directly related to the possibility of their use in systems based on smart contracts.

At the same time, the regulator believes that the manufacturability and digital capabilities of tokenized funds held in accounts with commercial banks should not be significantly inferior to the capabilities of CBDC.

“Tokenization will keep the attractiveness of money created by commercial banks for economic agents, not only because of interest payments, but also because of the potential use of smart contracts,” the report says.

Among other advantages, the Central Bank calls the reduction in the cost of transactions due to the automation of settlements, the emergence of new opportunities for international payments, as well as for the design of new services, including in the areas of Web3 and the Internet of things.

In addition, the tokenization of non-cash funds will become an alternative to money surrogates. The Russian regulator includes cryptocurrencies and stablecoins as such.

At the same time, the Central Bank pointed to the risks of the new tool, including possible token vulnerabilities, loss of anonymity and confidentiality of transactions, unfair actions due to the lack of control over smart contracts, and monopolization.

In general, the Bank of Russia concluded that maintaining the attractiveness of non-cash money, including tokenized money, is a factor in maintaining the potential for lending to the economy by the banking sector.

Earlier, the Central Bank of the Russian Federation spoke about possible restrictions for the digital ruble.

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