Russian ruble stablecoin concept received special attention at the Blockchain Forum in Moscow

Sergey Mendeleev, founder of the digital settlement exchange Exved and inactive founder of the sanctioned Garantex exchange

At a major local crypto event, the Blockchain Forum in Moscow, the concept of a Russian ruble stablecoin was discussed at length, with key industry executives reflecting on some of the core features such a product might require.

Speaking at the Blockchain Forum on April 23, Sergey Mendeleev, founder of the digital settlement exchange Exved and inactive founder of the sanctioned Garantex exchange, highlighted seven key criteria that a potential "replica of Tether" would need to meet.

According to Mendeleev, a potential ruble stablecoin should offer non-KYC transactions, so users are not required to pass their data to start using it.

"The Russian ruble stablecoin should have the opportunity where people use it without disclosing their data," he said.

Moreover, a potential Russian version of Tether’s USDt (USDT) would need to feature untraceable and cheap transactions, while its smart contracts should not enable blocks or freezes, he added.

The final criterion is that a potential ruble stablecoin would have to be regulated in accordance with the Russian legislation, which currently doesn't look promising, according to Mendeleev.

"Once we put these seven points together [...] then it would be a real alternative, which would help us at least compete with the solutions that are currently on the market," he stated at the conference.

"It seems that no one is making an attempt to copy Tether. But if we put together seven points, then perhaps we can get an interesting product. Unfortunately, I don't think that this is a realistic scenario yet. But if we talk about the potential, then we can highlight several key features."

The Dai model praised

Mendeleev proposed that a potential Russian "Tether replica" must be overcollateralized similarly to the Dai (DAI) stablecoin model, a decentralized algorithmic stablecoin that maintains its one-to-one peg with the US dollar using smart contracts.

"So, any person who buys it will understand that the coin is based on the assets that super-securitize it, not somewhere on some unknown accounts, but it is open to be checked by simple crypto methods."

Another must-have feature should be excess liquidity on both centralized and decentralized exchanges, Mendeleev said, adding that users must be able to exchange the stablecoin at any time they need.

According to Mendeleev, a viable ruble-pegged stablecoin also needs to offer non-KYC transactions, so users are not required to pass their data to start using it.

"A Russian ruble stablecoin should have the opportunity where people use it without disclosing their data."

In the meantime, users should be able to earn interest on holding the stablecoin, Mendelev continued, adding that offering this feature is available via smart contracts.

Russia opts for centralization

Mendeleev also suggested that a potential Russian version of Tether’s USDt (USDT) would need to feature untraceable and cheap transactions, while its smart contracts should not enable blocks or freezes.

The final criterion is that a potential ruble stablecoin would have to be regulated in accordance with the Russian legislation, which currently doesn't look promising, according to Mendeleev.

"Once we put these seven points together [...] then it would be a real alternative, which would help us at least compete with the solutions that are currently on the market.

"It seems that no one is making an attempt to copy Tether. But if we put together seven points, then perhaps we can get an interesting product. Unfortunately, I don't think that this is a realistic scenario yet. But if we talk about the potential, then we can highlight several key features."

Possible solutions

While the regulatory side is not looking good, a potential Russian version of USDT is technically feasible, Mendeleev told Cointelegraph.

"Except for anonymous transactions, everything is easy to code and several projects have already done it, but it's not unified in one project yet. For example, there are interesting opportunities by A7A5 with the ruble-pegged stablecoins, unblocable contracts by DAI and others."

According to him, regulation is necessary but not enough.

"The most difficult part is the trust of users who must see the ruble stablecoin as a viable alternative to major alternatives like USDT."

Recent reports suggest that the deputy head of Russia’s Finance Ministry’s financial policy department urged the government to develop ruble stablecoins.

Elsewhere, the Bank of Russia has continued to progress its central bank digital currency project, the digital ruble. According to Finance Minister Anton Siluanov, the digital ruble is scheduled to be rolled out for commercial banks in the second half of 2025.