Russia’s replacement for the Society for Worldwide Interbank Financial Telecommunication (legally SWIFT) service to the financial industry may finally have arrived after months of talk about its development.
Rostec, a state-owned defense conglomerate headquartered in Moscow, announced that it has developed a blockchain platform that can be used for international settlements. Called industrial blockchain CELLS, it replaces SWIFT by Russia.
In his Press release, the company pointed out that the CELLS blockchain was developed by one of its 700 subsidiaries named Novosibirsk Institute Software Systems (NIPS). The platform is multifunctional and can handle up to 100,000 transactions per second, with the potential to further increase throughput.
According to Rostec Executive Director Oleg Yevtushenko, the platform will allow settlements in national currencies and allow Russia to circumvent all international sanctions.
“The system will allow the switch to settlements in national currencies, eliminate the risk of sanctions and ensure the independence of national financial policy for clearing participants,” Yevtushenko said.
The company is also looking to expand its blockchain functions beyond international regulations. Among other use cases, the release’s highlights include user identification, data storage, issuance of digital passports, and a web application tool protected against hacking and DDoS attacks, among others.
The company is already inviting potential consumers, including software developers, product/system integrators, large enterprises, financial institutions and banks, to try the solution.
International Sanctions Push Russia To Blockchain Technology
Following Russia’s invasion of Ukraine, the mainly Western international community launched a massive sanctions campaign against Russia. The country is shut out of most international markets and services, with its economy and financial system under the most attack.
According to a Wall Street Journal report, the European Union this week approved the sixth installment of sanctions against Russia. Sanctions include a gradual embargo on Russian oil. The US Treasury Department also expanded its list of special Russian designations this week.
Russia’s search for alternatives to SWIFT, as well as to evade other international sanctions, has led it to explore blockchain technology and other digital currency solutions. Russia grants legal recognition to digital currencies and introduces a CBDC.
Russian digital currency legislation will encompass bulk trading and reward mining. Meanwhile, its CBDC is on track to launch a pilot phase by next year, as announced by the President of the Central Bank of Russia, Elvira Nabiullina.
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