Ukraine’s central bank is supervising a new digital currency pilot program using the Stellar blockchain.
According to a press release by FinTech firm Bitt, it is working with TASCOMBANK, which is one of Ukraine’s oldest commercial banks, on a pilot project to create an electronic version of Ukraine’s national currency “hryvnia” (UAH) on Stellar.
As part of this pilot, “the cross-company team will test the electronic hryvnia on the use cases of programmable payroll for public employees at Diia, an IT solutions enterprise, as well as for peer-to-peer payments and merchant payments.”
The project is being supervised by the National Bank of Ukraine and it has the support of the Ministry of Digital Transformation.
Oleksandr Bornyakov, the Deputy Minister of Digital Transformation of Ukraine, says:
“This pilot project will serve as a technological basis for the issuance of electronic money, and is the next key step to advance innovation of payment and financial infrastructure in Ukraine.“
Per the press release, the goal of the project is “to pilot the issuance of electronic money on an open blockchain with asset-control capabilities for issuers.” TASCOMBANK will “build and test the regulated electronic hryvnia on Stellar, and it will be deployed on Bitt’s Digital Currency Management System (DCMS).” Bitt’s DCMS “encompasses a core monetary transaction network, a secure minting system, and a Digital Currency Operations Manager.”
TASCOMBANK Chairman of the Board, Volodymyr Dubey, stated:
“With the rapidly growing impact of virtual assets on our everyday life and economic landscape, it is essential to utilize the advantages of blockchain technology and new related products as a part of the bank’s long-term market strategy.
“Cooperation with Bitt to build on Stellar allows us to connect our core banking system with blockchain-based infrastructure, creating an ecosystem that includes a full range of banking products and operations with electronic currency on the Stellar blockchain. Electronic currency paves the way to more sophisticated products in the virtual assets field that we are excited to explore.“
And Denelle Dixon, CEO and Executive Director of the Stellar Development Foundation, had this to say:
“Stellar is an open network that was designed with asset issuance in mind, and is uniquely suited to assets like the electronic hryvnia. It offers issuers, like TASCOMBANK, a suite of controls that they can configure for their asset control needs while maintaining the interoperability and flexibility of an open ledger. We are excited that TAS and Bitt have chosen the Stellar network for this ground-breaking pilot.“
Finally, it is worth pointing out that this regulated electronic hryvnia will be “built under the current e-money legislation of Ukraine.” Ukraine’s payment services law, which governs “the circulation of electronic money and future issuance of a digital currency under the authority of the National Bank of Ukraine” is expected to become effective in 2022.
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