The National Bank of Ukraine presented to representatives of banks, non-banking financial institutions, and the virtual assets market for discussion of the project of the concept of e-hryvnia – digital money of the National Bank.
This is reported by the National Bank of Ukraine.
E-hryvnia is an electronic form of the monetary unit of Ukraine, the issuer of which is the National Bank.
The key purpose of the electronic hryvnia is to effectively perform all the functions of money, supplementing the cash and non-cash forms of the hryvnia. The use of e-hryvnia should be convenient and accessible to all segments of the population, legal entities, state bodies, banks and non-bank financial institutions.
Back in September of last year, the National Bank launched the “E-hryvnia” project to experimentally determine the feasibility of a large-scale digital hryvnia issue in Ukraine.
In October 2022, the State Enterprise Ukrainian Institute of Intellectual Property (UKRPATENT) registered the trademark e-hryvnia, which belongs to the National Bank of Ukraine.
“The development and implementation of the e-hryvnia can be the next step in the evolution of the payment infrastructure of Ukraine, it will contribute to the digitalization of the economy, the further spread of cashless payments, a reduction in their cost, an increase in their level of transparency and an increase in trust in the national currency in general. This can have a positive effect on ensuring economic security and strengthening the monetary sovereignty of the state, will strengthen the ability of the National Bank to maintain price and financial stability as a guarantee of sustainable economic growth,” said Deputy Chairman of the National Bank Oleksii Shaban.
During the discussion with financial market participants, the National Bank also presented the possible design of the e-hryvnia, its architecture, characteristics and advantages for payment service providers. The use of a technological platform for instant e-hryvnia payments, service programming and data flow analysis will create ample opportunities for the emergence of new business cases, digitization of services, attraction of new customers, cost optimization, etc.
During the creation of the e-hryvnia concept project, the regulator took into account the results of the survey of financial market experts regarding the demand for e-hryvnia, the global experience of developing digital currencies of central banks and our own research.
Currently, the National Bank is considering and developing the following possible options for using the e-hryvnia, which will depend on its design and main characteristics:
- e-hryvnia for retail non-cash payments with the possible functionality of“programmed“money: to implement targeted social payments, reduce government spending on administration and control of the targeted use of funds, as well as use smart contract technology to program various calculation logic depending on the occurrence of certain circumstances and facts;
- e-hryvnia for use in the field related to the circulation of virtual assets (for example, for exchange, provision of issuance, and other operations with virtual assets). E-hryvnia can become one of the key elements of the qualitative development of the infrastructure for the market of virtual assets in Ukraine;
- e-hryvnia to enable cross-border payments: will provide the ability to make cross-border payments faster, cheaper, and more transparently.
At the same time, the National Bank, like most central banks of the world, will approach the issue of issuing its own digital currency carefully and taking into account, in particular, the potential impact of its introduction on the financial system of the state.