A survey of financial professionals indicated that the industry wants Ukraine’s future digital currency to be used as a tool in the crypto space. The financial sector is also favoring a blockchain design for the e-hryvnia that would allow peer-to-peer transfers and fuel e-commerce.
Financial experts define potential uses of Ukrainian digital currency
The National Bank of Ukraine (NBU) has released the results of a survey to establish the potential demand for a central bank digital currency (CBDC). The regulator sent a series of 30 questions to 100 financial experts from a variety of backgrounds – financial markets, businesses and retail, public sector and crypto firm.
The survey was also to identify possible use cases for e-hryvnia. NBU was among the first central banks to start exploring options for issuing its own digital currency. He launched a study in 2016, then tested a CBDC in retail payments two years later. “We already have practical experience in the implementation of a pilot project for issuing e-hryvnia in 2018,” noted NBU President Kyrylo Shevchenko, adding:
To find the really popular options and niches for the e-hryvnia and to determine the potential effect of its implementation, we decided to hear the opinion of experts in the financial markets and conducted a thorough investigation.
Representatives of the financial industry were offered a choice of six potential areas in which they believe the e-hryvnia can be used. According to the majority of respondents, the most promising use case would be non-cash retail payments, primarily peer-to-peer (P2P) transfers and e-commerce transactions. The use of the CBDC for cross-border payments, again as a P2P instrument, is the second most recommended application.
Other options included “Targeted Social Benefits (G2P)”, “Securities Settlement (B2B)”, “Business Payments (B2B)” and “Financial Instruments”. 77% of respondents supported the first of these use cases, provided its scope is broadened to include other specific government payments such as dedicated grants. The NBU has said it will take into account the opinions of financial professionals.
Ukrainian Financial Sector Says E-Hryvnia Should Be Used In Crypto Space
Many participants in the survey also supported the use of the electronic hryvnia as a tool for carrying out transactions in the field of virtual assets, noted the NBU. Representatives of the financial sector also insisted that the CBDC should be a blockchain-based currency.
Considering the size of the crypto asset market in the country and the availability of blockchain technologies, the Ukrainian central bank believes that the use of its digital currency to facilitate the movement of virtual assets in the country – for example, in exchange , issuance and other related crypto-transactions – deserve further research.
Ukraine is considered a leader in cryptocurrency adoption as it was ranked first among more than 150 countries in last year’s edition of the Global Crypto Adoption Index by blockchain forensics firm Chainalysis. However, the Kiev government has yet to pass comprehensive regulations for the country’s expanding crypto space. A bill on “On virtual assets”, which has been recently updated, is expected to be passed this year.
What is your opinion on the possible uses of a central bank digital currency? Share your thoughts on the subject in the comments section below.
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