Blockchain technology makes it necessary to take a fresh look at how we exchange documents and money. It removes intermediaries and allows users to directly send each other important data.
Blockchain is often compared to a standard diary or card file, where successive entries are made in chronological order. No stranger can make changes to this diary as all information is encrypted.
However, if there was only one copy of the diary, anything could happen to it. Therefore, for reliability, a blockchain has many copies that are stored in different places all over the world. Moreover, when new information is entered, it is updated on all copies after verification.
Some are already calling it one of the biggest breakthroughs of the 21st century, while others look on cautiously.
Russian companies and the country’s government are looking to take advantage of this fantastic technology.
Russia is already looking to implement blockchain technology in a few sectors, such as:
- financial operations
- real estate transactions
- traffic violations
- registration of marriages
Russian projects based on blockchain technology
Russia is currently working on developing a “blockchain passport” for students which will accumulate all information over a child’s first 11 years of study, including assessments, achievements, participation in competitions, vocational guidance testing, and more.
The Minister of Economic Development of the Russian Federation, Maxim Oreshkin, believes that this will make it possible to completely abandon the Unified State Exam (USE).
The main goal of this initiative is to have impartial artificial intelligence distribute graduates to universities without any exams rather than being dependent on USE points.
The Sberbank blockchain laboratory
The biggest bank in Russia, Sberbank, recently announced that it had opened a blockchain laboratory. This laboratory will explore the latest technologies in the blockchain field, form and propose ideas for developing solutions based on the tech, create product prototypes, conduct pilot projects, and implement applied business solutions for Sberbank.
The laboratory will also cooperate with other market participants, support start-ups, and conduct informational and educational activities to popularise blockchain technology.
Sberbank believes that blockchain is a tool for increasing the efficiency of interaction between market participants and is aiming to contribute to the future of the banking industry and the country.
Blockchain in Russian retail businesses
A number of companies in Russia have now started implementing blockchain into their operations. Trading company M.Video – in partnership with Alfa-Bank and Sberbank – has launched a blockchain platform based on Ethereum which aims to expand the possibilities of counterparty interaction by forming a “blockchain consortium”.
S7 Airlines is also using smart contract technology to automate ticket sales for flights, while Vnesheconombank – together with NITU (National Research Technological University) – has established a specialised center where users learn how to work with blockchain technology.
Megafon has also issued securities that are bought and sold on the blockchain. The platform was created and launched by the National Settlement Depository and is based on Ethereum. It helps to ensure anonymity and compliance with the regulations governing the securities market.
Russian payment service provider QIWI also attempted to create a new national cryptocurrency called the Bitruble.
The attempt failed for two reasons:
- The Central Bank of Russia initially supported the project, but later changed its mind due to the negative attitude of the government to virtual money and the possibility of it being used by fraudsters
- The Ministry of Finance proposed to establish criminal penalties for issuing cryptocurrencies and conducting operations with them
The company is now working on projects such as SKYFchain (an unmanned transportation project) and Masterchain, which is positioned as a national network that takes into account Russian legislation and cryptography.
Other projects based on the blockchain
There are a number of other blockchain projects in the pipeline in Russia, including:
- The Ministry of Health has focused its efforts on creating a blockchain platform to store medical records. Patients will be able to determine for themselves who gets access to their health data.
- The government is also looking at the possibility of a blockchain platform for the housing market. The advantage of the project is to increase confidence in the interaction of realtors, banks, owners, and buyers.
- Another blockchain platform is being developed to store information about the education and work experience of Russian citizens to aid employers.
- Universities may start adding video lectures and documentation on the blockchain.
- MGIMO has also started training blockchain lawyers on the assumption the technology will become more prevalent in the future.
- The Moscow City Duma is currently working on the possibility of digital city management. The idea is supposed to unite health care and housing. Cloud technologies and blockchain will help improve the transparency and security of the real estate market.
Ideas for the use of blockchain technology in Russia do not always reach the stage of creation. This is due to the lack of financial and human resources. Despite this, many innovative solutions are being developed or planned for implementation in Russia.
Russia is confident that the introduction of blockchain technology will provide support for small and medium-sized enterprises, and will therefore increase the efficiency of economic sectors.
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Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.