Tascombank conducts pilot testing of the digital hryvnia on the Stellar blockchain

What’s new? Ukrainian commercial bank Tascombank published the results of the pilot project on the issue of the digital hryvnia on the Stellar network. According to the report, for the National Bank of Ukraine and the Ministry of Digital Transformation, the benefits of e-money issuance on blockchain include greater transparency and accountability, improved security and confidentiality of client data, low transaction costs, instant payments functionality, and high throughput of the blockchain platform.

Tascombank’s report

Stellar is a decentralized payment protocol for currency exchange and transactions. The platform was founded by co-founder and former Ripple CTO Jed McCaleb. The native token is Lumen (XLM). As of January 13, the asset ranks 29th in the rating of cryptocurrencies by market capitalization with a figure of $2,14 billion and is trading at $0,0814, having gained 1,75% in 24 hours.

What else does the report say? The goal of the pilot project, launched in 2021, was to test the issuance of electronic money on an open blockchain with asset control capabilities for issuers. It focused on peer-to-peer (P2P) transactions and merchant payments, as well as payroll.

Sergii Kholod, the First Deputy Chairman of the Board of Tascombank, noted that as part of the pilot project, the team explored a new way to issue and manage electronic money. These assets could become a new generation payment tool for citizens and organizations of Ukraine, their employees, and clients, as well as government agencies and international organizations. The results of the pilot project showed that the bank’s infrastructure is open to implementing blockchain solutions in the future, taking into account all regulatory requirements, Kholod added.

The basis for launching the project was the Ukrainian legislation on electronic money. Regulatory changes introduced in 2022 allowed the model to be improved and the current system of bank accounts to be used.

Oleksii Shaban, Deputy Governor of the National Bank of Ukraine, believes that there are still many hypotheses to study and test within the framework of pilots, but the results of this project are important material for the analysis and use in the work of commercial and central bank specialists.

In turn, Oleksandr Bornyakov, the Deputy Minister of Digital Transformation, noted that the results of the pilot project proved the key advantages of blockchain, including speed of processing transactions and their lower transaction cost, accountability and transparency of the system, as well as simplified access to financial services. He said that the ministry, together with Tascombank, is considering further introducing blockchain-based payment instruments to the market.

Denelle Dixon, CEO and Executive Director of the Stellar Development Foundation, added that the results of this pilot project show the potential utility of the technology for companies, governments, and citizens.

Earlier, the Bureau of Economic Security of Ukraine (BEB) exposed a major international money laundering scheme using digital currencies. A total of 152 million Ukrainian hryvnias (about $4 million) were seized during the search.