Blockchain technology can help solve current problems with settlements, according to the deputy general manager of Sberbank. Russia’s largest bank is working with other financial institutions to develop blockchain-based payment apps, the banker revealed.
Sberbank sees solution to Russia’s problems with settlements in blockchain
With major Russian banks disconnected from the main global interbank payment system, FASTdue to Moscow’s war against Ukraine, blockchain will help solve the problem of payments, the first deputy general director of Sberbank, Alexander Vedyakhin, is convinced of this.
“It’s blockchain technology that will solve this problem because it’s a distributed ledger, there’s no single decision point, no center, no knife-edge switch that can be extinguished,” Vedyakhin said, as quoted by Interfax. Press Agency.
“Everyone has recorded everything, there are special protocols that allow it to be done confidentially,” the executive added during a meeting of the Federation Council’s Budget and Financial Markets Committee, the chamber high of the Russian parliament.
Sberbank, a majority state-owned company, which is Russia’s largest bank by assets, is currently conducting research on applications of blockchain technology in collaboration with other banking institutions and the Central Bank of Russia. Vedyakhin, who believes blockchain will become even more relevant in 2023, pointed out:
The next generation payment systems are the blockchain.
Speed and privacy issues overcome in latest protocols, says Vedyakhin
The banker also noted that crypto-related technology has grown over the past few years and highlighted some of the outstanding issues that needed to be addressed. These include the capacity of blockchain platforms and the confidentiality of transactions.
“The first was speed. What we saw before did not allow us to process a large number of transactions. Now we believe this issue has been generally resolved. The second was privacy… If we have a transaction and 10 million more people see it, you’re unlikely to want to complete it. Now this problem has also been solved in the new protocols, ”explained Alexander Vedyakhin.
A number of Russian banks, including Sberbank, have been targeted by US and EU sanctions following the invasion of Ukraine in late February 2022. Financial restrictions have significantly limited the access of the Russia to the global financial system.
Last June, Sberbank CEO Herman Gref said the bank had started work on setting up an international settlement system, alternative to SWIFT, planning to complete it within a year. Russian manufacturing and technology conglomerate Rostec announced a blockchain-based platform with the same goal the same month. Legalizing crypto payments for cross-border settlements has also been considered as an option.
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