In Ukraine want to launch a digital currency, - NBU

In Ukraine want to launch a digital currency, - NBU

The National Bank of Ukraine (NBU) has begun preparations for a pilot project of the digital hryvnia, which is expected to complement cash. The decision for full implementation of the e-hryvnia has not yet been made, but it is expected that testing will allow for an assessment of its effectiveness and popularity among users.

This was announced by the Deputy Head of the NBU, Oleksiy Shaban. The e-hryvnia is a digital form of the national currency, to be issued and controlled by the NBU.

It will operate exclusively in a non-cash form and perform all monetary functions, allowing citizens to conduct regular financial transactions. In particular:

• transfers between individuals (P2P transactions);
• payment for goods and services;
• making payments to the state;
• charitable donations;
• receiving salaries, social benefits, and other income.

Why the e-hryvnia is needed

According to Shaban, creating the digital hryvnia aligns with global trends. Central banks of many countries, including the EU, Turkey, India, China, Brazil, and Singapore, are already testing or implementing their own CBDCs (central bank digital currencies). The National Bank of Ukraine considers the implementation of the e-hryvnia to achieve several key goals:

• modern and fast payments: the e-hryvnia will enable programmable payments (e.g., regular automatic transfers or payments upon certain conditions);
• financial security: using digital currency will reduce the risks of banking crises and promote financial system stability;
• digitization of the economy: the e-hryvnia can increase the level of financial inclusion in Ukraine and stimulate the development of electronic payments;
• privacy protection: unlike cryptocurrencies, the digital hryvnia will maintain a high level of privacy, as the NBU will not have access to personal user data.

When will the e-hryvnia testing take place

The NBU has already started preparations for a pilot project, which will be implemented based on DLT (Distributed Ledger Technology) in an open environment. This means that testing will take place with real users and payment services.

The main goal of the pilot project, according to Shabunin, is to check if the e-hryvnia can effectively perform the functions of money, meet consumer needs, and how convenient it is to use. He also noted that the e-hryvnia will not replace cash, which will remain in circulation, and the NBU does not plan to fully abandon it.

The e-hryvnia will only complement the existing forms of the hryvnia (cash and non-cash), and citizens will be able to choose how to make payments themselves. Despite the advantages, there are several challenges that could complicate the implementation of the digital hryvnia:

• legal aspects: legislation needs to be updated to regulate the new type of payment instrument;
• infrastructure: banking systems and payment services must be ready to work with digital currency;
• level of trust: people may distrust the new form of money, so an active information campaign is needed.