Following the invasion of Ukraine, Russia’s largest bank, Sberbank, launched its own native cryptocurrency, the Sbercoin.
Russia has been battered by a barrage of sanctions since its invasion of Ukraine. It was eventually cut off from the majority of its foreign currency reserves as well as the global financial system. In the midst of it all, Russia’s largest bank, according to local media, announced the launch of a cryptocurrency.
On March 17, the Russian Federation’s Central Bank granted Sberbank a license to issue and exchange digital financial assets. Sberbank was placed on the central bank’s register, along with financial ecosystem Lighthouse, permitting both companies to issue and trade digital assets on their platforms.
However, Sbercoin was reportedly introduced on the same day by Russia’s largest bank, according to media sources. Sbercoin’s introduction, according to some industry observers, could be a mechanism to trade rubles for other currencies without avoiding Western sanctions.
Sberbank announced that it would use blockchain technology to maintain the security of digital transactions, allowing firms to develop their own digital assets, buy Sberbank’s, and conduct other transactions. Sberbank CEO German Gref stated in late 2020 that the bank was working with JP Morgan on the development of its own cryptocurrency, Sbercoin, which has yet to go live.
Sbercoin, a savior in disguise
Since the conflict, Russia has struggled to pay its dollar-denominated obligations. Some believe sbercoin will be utilised to circumvent the restrictions. However, Asheesh Birla, the general manager of RippleNet, believes that this idea is debatable. In an interview with Markets Insider, the CEO of the blockchain-based payments service provider remarked,
“It’s going to be super-problematic for them to get much traction here because they also need a liquid exchange that is going to take the Russian ruble.”
On March 17, Sbercoin started trading at $0.0003617, with a 24-hour trading volume of $948,000. According to data from CoinMarketCap, the coin, which is traded on Pancakeswap, has dropped 30.94 percent to $0.00006707 in the last 24 hours.