Update, Dec 10 2015 17:03 GMT: Updated with comment from R3 spokesperson.
Russia’s largest bank, Sberbank, reportedly wants to join the growing global consortium of banks collaboratively developing blockchain technology to streamline payments and securities trades.
Lev Khasis, Sberbank’s First Deputy Chairman of the Management Board, told Russian news publication Kommersant that the bank is watching the blockchain evolution very closely. As soon as institutional blockchain solutions become available, he said, the bank will be among the first to implement them.
At least 30 banks have joined the consortium led by FinTech development startup R3 CE. Most recently, a number of Bitcoin and blockchain experts were brought on board as well.
The goal is to develop an interoperable Blockchain framework compatible with the systems of all member banks. A sustainable blockchain network can potentially yield tremendous cost savings, cut down settlement times and eliminate error.
Currently, there are no Russian banks in the R3 consortium. Sberbank is Russia’s first bank to publicly disclose its keen interest in adopting blockchain technology.
R3 did not respond to a Kommersant request for comment. Speaking to Finance Magnates, an R3 spokesperson commented:
The Participants in Forex Trading and their Role in the MarketGo to article >>
“Interest in our distributed ledger initiative amongst the international banking community has continued to grow at a rapid pace since its launch in September, and while we are in preliminary discussions with a number of institutions that have requested to join the initiative, we are unable to comment on any ongoing commercial discussions.”
The spokesperson declined to comment directly on the Kommersant report or on the possibility of Sberbank’s participation.
Not a Blockchain Ban
Russia has proposed to ban cryptocurrencies like bitcoin, and has drafted a schedule of penalties that now include corrective labor. The legality of Bitcoin has hung in limbo for roughly two years now, its status appearing to swing with each conflicting statement made by a government figure.
Blockchain technology inspired by Bitcoin should not be covered by such a ban. In theory, however, any type of blockchain network is dependent on the movement of “tokens” of cryptocurrency over its rails, which may technically fall under digital currency as defined by the ban.
Russian payments giant Qiwi has proposed its own cryptocurrency, a “bitruble”, which drew condemnation from officials. Financial Ombudsman Pavel Medvedev indicated that the cryptocurrency would be illegal. Sberbank’s Chairman, Herman Gref, disagreed.
Khasis stressed that Sberbank has no plans to issue its own cryptocurrency, citing the aforementioned legal concerns. However, he sees no problem using a blockchain to conduct fiat settlements internally and between other banks. The blockchain is just a simpler, faster and more reliable means to settle payments, he argued.
Cyril Kibalko, Director of IT Development at Home Credit, further suggested that joining a blockchain network can prove valuable if Russian banks were to be cut off from SWIFT’s interbank network. Amid sanctions against Russia last year, some EU states pushed SWIFT to block Russian banks, but SWIFT refused.