Ukrainian bank uses Stellar to launch electronic hryvnia pilot project

Tascombank, one of Ukraine’s oldest commercial banks, is launching a Stellar-based pilot project for Ukraine’s national fiat currency, th...



Tascombank, one of Ukraine’s oldest commercial banks, is launching a Stellar-based pilot project for Ukraine’s national fiat currency, the hryvnia.

The Stellar Development Foundation (SDF) on Tuesday announced a private electronic hryvnia pilot project launched by Tascombank and fintech firm Bitt.

The electronic hryvnia pilot project is implemented under the supervision of the National Bank of Ukraine and is supported by the Ministry of Digital Transformation (MDT).

Oleksandr Bornyakov, Deputy Minister of MDT, said the pilot project will provide a “technological basis for issuing electronic money” and is the “next key step to advance innovation in payment and financial infrastructure in Ukraine” .

SDF CEO Denelle Dixon told Cointelegraph that pilot work has already started, with the first test including programmable payroll for public employees at Diia, a state-owned IT solutions company owned and supported by MDT of Ukraine. .

“This regulated electronic hryvnia will be privately issued electronic money on blockchain technology, built under current Ukrainian electronic money legislation,” Dixon noted.

The objective of the initiative is to test the issuance of electronic money on an open blockchain. Tascombank is responsible for creating and testing the electronic hryvnia on Stellar for deployment on Bitt’s transaction network known as the Digital Currency Management System, or DCMS.

“Bitt’s DCMS will equip Tascombank with all the technology needed to securely strike, store, issue, distribute and redeem the electronic hryvnia,” said Brian Popelka, CEO of Bitt.

While Bitt provides a transaction network, SDF will help Tascombank “configure itself for their asset control needs while maintaining the interoperability and flexibility of an open ledger,” noted Dixon.

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The Ukrainian government is actively exploring Stellar for the implementation of digital currency. In January 2021, the MDT first in partnership with the SDF develop a digital asset and infrastructure strategy for a central bank digital currency.

“We continue to provide feedback and advice to MDT on their strategy work,” Dixon said, adding that the electronic hryvnia pilot is a separate workflow.