Ukraine Bucks Trend as it Ponders Implications of CBDC, Solid Signal of Private Sector Investment

Recently, the National Bank of Ukraine published its study, “Survey results on the possibility of e-hryvnia implementation.” Perhaps among its most notable elements, it found that a CBDC would be most welcome as a way to better facilitate cashless retail payments, in contrast to many other entities which are looking at the innovation as a way to blunt the disappearance of cash or as a primary method to facilitate cross-border payments.

“In this case, where a number of the respondents came from the retail sector, it makes sense that there is interest, as a CBDC could provide relief from the high cost of payments. Particularly intriguing is that the majority of market participants surveyed said that they would be potentially willing to invest in CBDC infrastructure and, once launched, promotions,” said Richard Gardner, CEO of Modulus, a US-based developer of ultra-high-performance trading and surveillance technology that powers global equities, derivatives, and digital asset exchanges.

“This is notable because one of the biggest barriers to a transition toward a CBDC will be the education factor. Getting the populace onboard and utilizing the technology may prove challenging for certain subsections of the population. The fact that private sector participants are willing to step up and offer assistance with promoting the new method is promising,” said Gardner.

In the survey, 73% of respondents believe that e-hryvnia should be implemented using blockchain technology. Also, the survey noted that the most convenient means for retail cashless payments using e-hryvnia would be a bank/company mobile application and a single national mobile application.

“One of the great things about what Ukraine is doing is found in their process. They’re actively engaging with stakeholders from across a wide spectrum of sectors. Bringing in innovators and market leaders to decide how your country can best benefit from a CBDC is something that more bureaucrats should consider. There needs to be open communication between the folks that understand industry, those that understand the technology, and those in charge with regulation and implementation on the government side,” opined Gardner.

Modulus is known throughout the financial technology segment as a leader in the development of ultra-high frequency trading systems and blockchain technologies. Over the past twenty years, the company has built technology for the world’s most notable exchanges, with a client list which includes NASA, NASDAQ, Goldman Sachs, Merrill Lynch, JP Morgan Chase, Bank of America, Barclays, Siemens, Shell, Yahoo!, Microsoft, Cornell University, and the University of Chicago.

“Beyond the intersection of the public and private sectors, the importance of which can’t be overstated, it is positive to see those surveyed have come to agree that the future of payments is found within the blockchain. Blockchain technologies are really a game changer in finance. They aren’t going away, and those who embrace them will come to excel over the next decade,” Gardner offered.