The Digital Currency of Central Banks: a Non-Standard Methodological Approach in the Legal Field of Ukraine
Abstract
Purpose. To analyze and identify the features of the world experience in the implementation of digital currencies of central banks (CBDC) in foreign countries, using a non-standard approach to the basics embodied in classic fiat money. Central banks have been providing the population with reliable money for hundreds of years as part of their public policy objectives. But the world is changing. To develop and reassess their public policy objectives in the digital world, central banks are actively exploring the pros and cons of offering a digital currency to the public – CBDC. On June 30, 2021, the Verkhovna Rada of Ukraine adopted the Law of Ukraine No. 1591-IX "On Payment Services", which is the first law that introduced a new legal concept into the general legal field of Ukraine – "digital money of the National Bank of Ukraine", which has similarities with the widespread world naming scheme, such as CBDC. Methodology. The methodological basis of the study is a complex of philosophical, general scientific (deduction and induction, synthesis and analysis, scientific abstraction, system approach) and special methods (formal legal forecasting, comparative legal method) necessary for the implementation of the scientific goal and the implementation of the tasks. Scientific novelty. In connection with the introduction of a new legal definition in the legal field of Ukraine, namely in the Law of Ukraine No. 1591-IX "On Payment Services", which will enter into force on 01.08.2022, – "digital money of the National Bank of Ukraine", and has similarities with the widespread world naming scheme as CBDC; It is necessary to work out at the scientific level the possibility of their practical implementation and understanding of their essence, impact on the domestic economy and society – through the prism of non-standard foreign experience, taking into account the accepted standards about fiat money. Findings. From the study, it can be argued that the latest approaches to forming a digital currency of central banks based on cryptocurrency or its parallel existence were considered a variation of views in many countries of the world. Ukraine was no exception to this way of forming a national CBDC. It may be recalled that the original version of the draft law No. 9083 of 14.09.2008 "On Amendments to the Tax Code of Ukraine Regarding the Taxation of Operations with Virtual Assets in Ukraine", although it was withdrawn and not ideal, from the point of view of legal technology, as evidenced by numerous expert conclusions made on this matter, intended to endow cryptocurrencies as an element of digital financial technologies, properties of fiat money. However, bitcoin and similar cryptocurrencies when used as a CBDC have significant risks to the macro-financial stability of the state and its financial integrity.
Keywords: cryptocurrency; bitcoin; stabelcoin; digital currency; electronic money; digital hryvnia.
Downloads
References
Про внесення змін до Податкового кодексу України щодо оподаткування операцій з віртуальними активами в Україні : відкликаний проєкт Закону України 2008 р. № 9083. URL: http://w1.c1.rada.gov.ua/pls/zweb2/webproc4_1?pf3511=64597.
Про внесення змін до Податкового кодексу України щодо оподаткування операцій з віртуальними активами : проєкт Закону України від 13 берез. 2022 р. № 7150. URL: https://itd.rada.gov.ua/billInfo/Bills/pubFile/1245233.
Про віртуальні активи : Закон України від 17 груд. 2022 р. № 2074-IX. URL: https://zakon.rada.gov.ua/go/2074-20.
Про платіжні послуги : Закон України від 13 квіт. 2022 р. № 1591-IX. URL: URL: https://zakon.rada.gov.ua/go/1591-20.
Про внесення змін до Податкового кодексу України щодо оподаткування операцій з віртуальними активами : проєкт Закону України від 2022 р. № 7150. URL: https://itd.rada.gov.ua/billInfo/Bills/Card/39211.
Bill to make Bitcoin legal tender passes in El Salvador. (2021, June 9). Cointelegraph. Retrieved from https://cointelegraph.com/news/el-salvador-president-bitcoin-law-will-be-approved-tonight.
Central bank digital currencies: Foundational principles and core features. (2020, October 9). Retrieved from https://www.bis.org/publ/othp33.htm.
Central Bank Digital Currency Tracker. Tableau Public. 2022. Retrieved from https://public.tableau.com/app/profile/atlanticcouncil/viz/shared/MKPP4MC54.
Cheng P. Decoding the rise of Central Bank Digital Currency in China: Designs, problems, and prospects. Journal of Banking Regulation. 2022. DOI: https://doi.org/10.1057/s41261-022-00193-5.
Cullen J. "Economically inefficient and legally untenable": Constitutional limitations on the introduction of central bank digital currencies in the EU. Journal of Banking Regulation. 2022. No 23 (1), 31-41. DOI: https://doi.org/10.1057/s41261-021-00162-4.
Cunha P., Melo P., Sebastião H. From Bitcoin to Central Bank Digital Currencies: Making Sense of the Digital Money Revolution. Future Internet. 2021. No 13(7), 165. DOI: https://doi.org/10.3390/fi13070165.
Ecofin A. La BCEAO désapprouve la création de la monnaie électronique de la BRM. Agence Ecofin. 2017. Retrieved from https://www.agenceecofin.com/commerce/0704-46420-la-bceao-desapprouve-la-creation-de-la-monnaie-electronique-de-la-brm.
El Salvador’s Bitcoin adoption an ‘interesting experiment,’ says BIS exec. (2021, Червень 11). Cointelegraph. Retrieved from https://cointelegraph.com/news/el-salvador-s-bitcoin-adoption-an-interesting-experiment-says-bis-exec.
El Salvador’s Bitcoin adoption may jeopardize IMF negotiations: JPMorgan. (2021, June 11). Cointelegraph. Retrieved from https://cointelegraph.com/news/el-salvador-s-bitcoin-adoption-may-jeopardize-imf-negotiations-jpmorgan.
Fegatelli P. A central bank digital currency in a heterogeneous monetary union: Managing the effects on the bank lending channel. Journal of Macroeconomics. 2022. No 71. P. 103-392. Retrieved from https://doi.org/10.1016/j.jmacro.2021.103392.
IMF urges El Salvador to remove Bitcoin’s status as legal tender. (2022, January 25). Cointelegraph. Retrieved from https://cointelegraph.com/news/imf-urges-el-salvador-to-remove-bitcoin-s-status-as-legal-tender.
IMF Blog. (2021, July 26). Cryptoassets as National Currency? A Step Too Far. IMF Blog. Retrieved from https://blogs.imf.org/2021/07/26/cryptoassets-as-national-currency-a-step-too-far/.
Kumar A., Ney J., Lee E., Ji V. National Digital Currencies: The Future of Money? Belfer Center for Science and International Affairs. 2020. Retrieved from https://www.belfercenter.org/publication/national-digital-currencies-future-money.
Marshall Islands digital currency would «raise risks,» says IMF. (2021, March 24). Cointelegraph. Retrieved from https://cointelegraph.com/news/marshall-islands-digital-currency-would-raise-risks-says-imf.
Peneder M. Digitization and the evolution of money as a social technology of account. Journal of Evolutionary Economics. 2022. No 32 (1). P. 175–203. DOI: https://doi.org/10.1007/s00191-021-00729-4.
Project Helvetia: A multi-phase investigation on the settlement of tokenised assets in central bank money. (2022, January 13). BIS. Retrieved from https://www.bis.org/about/bisih/topics/cbdc/helvetia.htm.
Project Helvetia Phase I: Settling tokenised assets in central bank money. (2020, December 3). BIS. Retrieved from https://www.bis.org/publ/othp35.htm.
Project Helvetia Phase II: Settling tokenised assets in wholesale CBDC. (2022, January 13). BIS. Retrieved from https://www.bis.org/publ/othp45.htm.
Senegal creates digital currency history. (2017, May 22). African Business. Retrieved from https://african.business/2017/05/economy/senegal-creates-digital-currency-history/.
US lawmakers introduce companion bill to «mitigate risks» from El Salvador’s Bitcoin Law. (2022, April 5). Cointelegraph. Retrieved from https://cointelegraph.com/news/us-lawmakers-introduce-companion-bill-to-mitigate-risks-from-el-salvador-s-bitcoin-law.
West African Digital-Currency Project Shunned by Central Bank. (2017, April 6). Bloomberg. Retrieved from https://www.bloomberg.com/news/articles/2017-04-06/west-african-digital-currency-project-shunned-by-central-bank.
Abstract views: 479 PDF Downloads: 529
Copyright (c) 2022 Philosophical and Methodological Problems of Law
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.
- Authors reserve the right to authorship of their own work and transfer to the magazine the right of the first publication of this work under the terms of the Creative Commons Attribution License, which allows other persons to freely distribute published work with mandatory reference to authors of the original work and the first publication of an article in this magazine.
- Authors have the right to enter into separate additional agreements on non-exclusive dissemination of the work in the form in which it was published in the journal (for example, to post an article in the institution's repository or to publish as part of a monograph), provided that the link to the first publication of the work in this journal is maintained.
- The journal's policy allows and encourages the posting of articles by authors on the Internet (for example, in electronic storehouses of institutions or on personal websites), both before the submission of this manuscript to the editorial office and during its editorial processing, as this contributes to the creation of a productive scientific discussion and positively affects the efficiency and dynamics of citing the published work.
