National Currency Research Articles

Attribution clause as a tool for addressing contractual imbalances and applicability in civil contracts

Abstract* Attribution rules act as a tool to modify the terms of a contract by accepting pre-specified terms and conditions. This methodology ensures that the contractual relationship is protected while addressing potentially complex scenarios that may arise during contract execution due to evolving circumstances. To maintain the binding force of the contract, Parties expedite dispute resolution and protect the integrity of their contracts by choosing recourse and prior agreeing to remedies, which encourages continuity in enforcement. These clauses are intended to automatically amend the terms of the contract without requiring the parties to participate in the amendment process. These items adjust the amount of funds subject to the obligation according to changes observed by external indicators associated with the obligation. This is done by comparing the price of a particular currency with the price of a different commodity. In the case of payment in gold or foreign currency, it represents an assault on the binding legal force of the national currency by competing with it as a means of payment and considering it as one of them. Terms of payment in gold and foreign currency are excluded from the attribution requirement, which replaces legal means of payment with new means of payment. It does not constitute a basis for determining the extent of fulfillment of the obligation, and we conclude that the attribution clause is a distinct legal system that deals with amending contractual terms and the contractual imbalance they cause. Amendment is permitted in the event of circumstances occurring that would upset the balance throughout the contract implementation period, and we recommend adopting the attribution clause as an automatic adjustment tool.

DIGITAL CURRENCY: RUSSIAN AND CHINESE EXPERIENCE

The rapid development of new technologies, such as big data, blockchain, and artificial intelligence, has propelled the digital economy to the forefront of history, necessitating the ability to adapt, keep up with the times, and improve legal regulations. In 2023, the Russian Federation took significant steps towards the introduction of the digital ruble. Specifically, transactions with the digital ruble were tested for the first time with the participation of real customers, and the State Duma adopted several important legal acts that amend the current legislation and regulate the introduction of the digital ruble in Russia. However, the swift evolution of digital currencies is not exclusive to Russia, many countries are grappling with the development and implementation of a new form of money. This form aims to simultaneously enhance the transparency and reliability of transactions while contributing to the stability of the national currency. In this article, we propose to examine the features of legal regulation and the conduct of transactions with digital currency, using the experiences of both the Russian Federation and the People's Republic of China as examples

Russia's transition to settlements in national currencies in the context of changes in the world monetary and financial system

Aim. To determine the background and prospects of the Russian Federation's (RF) transition to settlements in national currencies in the context of changes in the world monetary and financial system.Objectives. To analyze the current state of the currency market of the Russian Federation in terms of currency structure and main instruments; to identify the reasons for the transformation of the currency market of the Russian Federation; to characterize the prerequisites for the transition to settlements in national currencies in foreign trade; to assess the prospects of such a transition and its impact on the currency market of the Russian Federation in the context of the latest trends in the development of the global monetary and financial system.Methods. With the help of general methods of scientific cognition, graphical analysis the current state, dynamics and structure of the currency market of the Russian Federation in the conditions of sanctions are considered. In addition, the article assesses the background and prospects of the Russian Federation's transition to settlements in national currencies in view of the new trends in the development of the world monetary and financial system.Results. In 2022, after the economic sanctions against Russia were imposed, the state was forced to accelerate the process of transition to settlements in national currencies with major trading partners, and the domestic currency market underwent a significant transformation. In the conditions of digitalization of the financial sphere and the development of central bank digital currencies (CBDCs) , the introduction of international settlements using the digital ruble seems to be a promising direction.Conclusions. The period after the sanctions against the Russian Federation were imposed (2022) is marked by significant changes in the domestic foreign exchange market, primarily associated with the gradual displacement of world currencies (primarily the dollar) and their replacement by the ruble and renminbi. In general, this trend reflects the state of the RF foreign trade. With the reduction in the volume of the local foreign exchange market and the withdrawal of Western players, the government is taking measures aimed at preserving the potential of the foreign exchange market. A promising direction for international settlements under sanctions is through CBDC. However, the implementation of such a system will take years, during which the financial system of the Russian Federation will have to preserve its potential in isolation from Western financial markets.

Exchange Rate Regime Choices in Small Open Economies from Bretton Woods to Inflation Targeting

After centuries of metallic monies, for a long time, our understanding of fiat money had remained rudimentary and often controversial. Successive regimes eventually failed. The end of the Bretton Woods system marked the moment when the link between fiat money and gold was severed and when the possibility of letting exchange rates float became possible. The small open economies adopted various arrangements. Informed by these experiments, the understanding of monetary policy substantially progressed, leading to the widespread adoption of the expected inflation-targeting strategy with similar inflation targets. As a result, exchange rate variability has declined. The US dollar dominance was maintained and even increased. Yet, new challenges have emerged. The long period of interest rates stuck at the effective bound effectively suspended the use of the strategy. Then, during the post-pandemic surge in inflation rates, inflation forecasts became highly imprecise.

The Change of the Monetary Paradigm: Financial Security and Cryptocurrency

Abstract This study aims to investigate the economic characteristics of cryptocurrencies and assess the current legal framework regarding the potential to regulate transactions involving cryptocurrencies and other virtual assets. To achieve this goal, a complex set of general scientific and specialized research methods was applied, including comparative legal analysis, system-structural examination, generalization method, as well as methods of analysis and synthesis, DFD to build a model of the influence of cryptocurrency on the financial security of the state. As a result, we delved into the economic essence of blockchain-based cryptocurrencies as an alternative to traditional fiat currencies based on the principle of decentralization. It has been established that Bitcoin has a unique "hardness", due to which this cryptocurrency is rightly called «digital gold». The article analyzed the dynamics of the development of the use of blockchain technologies for 2009-2022, the results of which indicated the continuation of their annual growth in use. The article presents the results of a study on the introduction of cryptocurrency in Ukraine, which made it possible to systematize the main risks associated with it. In further research, it is possible to continue studying the economic-legal mechanism of the introduction of the national cryptocurrency in Ukraine and the use of blockchain in other financial processes at the state level.

Compliance in the internal control system of the business entity

Introduction. In the current global and Ukrainian environment, both objective and subjective factors interact and influence business. Political instability, corruption risks, economic crises (in particular, the impact of the COVID-19 pandemic), devaluation of the national currency and the war in Ukraine are factors that contribute to the aleatory nature of business. It is also important to take into account the views of stakeholders who point out the imperfection of legal support of internal control of business entities. This may lead to an underestimation of risks due to the impact of the above-mentioned factors. To reduce the negative impact, it is important to implement compliance measures, which are widely used in developed countries. These measures are becoming a key element in the integration of Ukrainian companies into the global economy. The purpose of the paper is to analyze the features of compliance in the internal control system of a business entity. The object of the study is compliance in the internal control system. The subject of the study is the role and value of compliance in risk management and compliance with standards. Results. The paper is devoted to the study of the concept of “compliance” in the internal control system of a business entity in order to improve its efficiency in the management system of banks in Ukraine and to ensure compliance with methodological recommendations and standards of corporate governance by professional participants of the stock market. The theoretical aspects of compliance, namely the definitions of authors in the scientific literature on this category are considered. The main types of compliance that are used for any business entities are highlighted. The features of the internal control compliance system to ensure the effectiveness of corporate governance are revealed, and also highlighted the priorities of the compliance function in foreign countries as a certain experience that requires purposeful implementation in our country. Conclusions. The compliance system of internal control of a business entity is an integral part of strategic management and achievement of its goals. It is important not only to recognize the importance of compliance, but also to systematically integrate it into the company's culture. A well-developed compliance system allows a business entity to effectively manage risks, improve processes and strengthen its position in the competitive environment. Therefore, the improvement of the internal control compliance system is determined by the need to constantly analyze and adapt to changes in the internal and external environment. This contributes to improving the sustainability, reliability and business reputation of the enterprise in the context of the establishment of demanding standards of management and corporate responsibility.

Role and importance of Egypt in regional geopolitics

The article analyzes the role and significance of the Arab Republic of Egypt in regional geopolitics at the present stage. The author pays special attention to the specific role of its armed forces, which not only perform tasks to protect the state from external threats and combat terrorism,but also take an active part in the internal political and economic life of the country. The peaceful nature of Egypt's foreign policy is emphasized, Cairo's desire to take part in the work of the UN, Arab League, AU, OIC, BRICS, EU, other international and regional organizations, and to maintain mutually beneficial relations with leading world powers, Israel, Arab, African and Asian countries on a bilateral basis. Diversifi cation of Egypt's foreign policy and foreign economic relations with foreign countries, maintaining a balance of interests of all countries interested in Egypt ensure stability and progressive development of the state in all areas. The author also points out the continuing objective diffi culties and even crisis phenomena in the Egyptian economy: infl ation, devaluation of the national currency, large external borrowings, youth unemployment, loss of income from the operation of the Suez Canal, the tourism industry, etc. The next serious test for the country was the tragic events in the Gaza Strip, when the Israel Defense Forces launched a large-scale military operation against the militants of the radical Islamist groups Hamas and Islamic Jihad (the latter is recognized as terrorist and is banned in Russia). The threat of an uncontrolled exodus of hundreds of thousands of refugees from this Palestinian exclave to the Sinai Peninsula requires vigilance and preventive measures from Egypt's security forces. Along with this, Egypt remains one of the leaders in the Middle East, Africa, and among Muslim countries. Cairo's emphatically independent foreign policy and neutrality in regional conflicts allows it to maintain strategic partnerships with the United States while simultaneously developing relations with Russia and China in all areas.

Феномен долларового парадокса и его роль в трансформации современной мировой валютно-финансовой системы

Currently, fundamental transformations are occurring within the global monetary-financial system. Contrary to the prevalent belief in the decline of the dollar, this article seeks to demonstrate that the American currency exhibits adaptive properties, which solidify its position in the international financial system, albeit possibly at a lower level. The experiences of other countries in promoting their national currencies in the international exchange, trade, and investment systems indicate that all such attempts yield varying degrees of success. Regarding the life cycle of foreign currencies, they initially establish themselves rapidly, increasing their share in operations, but then quickly encounter a natural limit and retract within their respective countries. Conclusion dwells upon the fact that the dollar primarily serves as the currency of developing countries, as they predominantly accumulate it. However, the sheer number of these states renders the probability of diversifying risks through potential alliances in the monetary-financial sphere against the dollar practically negligible, with rare exceptions such as the BRICS countries.

The banking system of Ukraine as a factor of social stability in the war

Before the collapse of the USSR, Ukraine was one of the 15 socialist republics. Along with Belarus, the Russian Federation, and the USSR, Ukraine is one of the founders of the United Nations. Ukraine has gone through transformations from a command-administrative to a market system in 30 years. The driving force behind this development was the national democratic forces, the leaders of which were former dissidents of the USSR. One of the main factors of market transformations in Ukraine is the national private banking business. In the conditions of Russia’s direct military aggression against Ukraine in 2022, the banking business of Ukraine has shown its institutional capacity and is one of the stabilizing factors of society. Thanks to the integration of Ukraine’s banking business into the global financial system, millions of Ukrainian refugees have the opportunity to use their accumulated funds in the national currency abroad. The purpose of this article is to analyze the impact of the banking sector of Ukraine on the country’s democratic development, and the contribution of the banking system to countering Russian aggression. The article considers further ways of development of the banking system of Ukraine in the post-war period.

Mining in Russia. Cryptocurrencies as investment

In modern conditions, when parity international financial and monetary relations are turning from traditional instruments of economic interaction into instruments of neocolonial political pressure and blackmail of economically strong countries against weaker ones, the need for a new global financial order and monetary standard, that would be independent of the will of any central bank, but with a value as reliable as that of modern fiat currencies, is increasingly realized. Today, the global economy feels the urgent need for fundamentally new opportunities for market interaction and monetary exchange. Cryptocurrencies have become such tools — electronic decentralized money issued by specific individuals in specialized open computer networks through the transformation of electricity into fixed computer codes. The process of such transformation is called mining, which uses ASIC miners as computer equipment to obtain cryptocurrency. The concept of cryptocurrencies and the specifics of investing in them are considered. The characteristic is presented of the current state and dynamics of the development of the crypto market. The possibilities and methods of forecasting the development of the cryptocurrency market are shown both using classical methods of economic forecasting and a fundamentally new methodology based on the current assessment of the psychological state of participants in the crypto market and their readiness to commit certain economic actions. An assessment is given of the possibilities of investing in mining as a technology for mining cryptocurrencies. Requirements to special mining equipment — ASIC miners — are described. An assessment is given of the prospects for the development of the crypto economy.

ОБЛІКОВА СТАВКА НБУ: НАСЛІДКИ ТА ДОЦІЛЬНІСТЬ ПОДАЛЬШОГО ЗНИЖЕННЯ

Introduction. The purpose of the latest increase in the key rate from 10% to 25% in June 2022 is the following: protection of savings and income of individuals in national currency; increasing attractiveness of hryvnia-denominated assets; easing the pressure of excess liquidity on the foreign exchange market; strengthening the ability of the NBU to ensure exchange rate stability and streamline inflationary processes during the war. The increase in the key rate was also supposed to increase the yield on domestic government loan bonds and deposit certificates of the National Bank of Ukraine (NBU), rates on line deposits in the national currency, and the cost of servicing hryvnia loans for legal entities and individuals. Over a period of up to 15 months, the key rate remained at the same level of 25%. As the dynamics of inflation faded, the regulator started a cycle of gradual easing of monetary policy. allows to analyze the intermediate results of such a reduction. Reporting of the financial and external sectors of the economy published by the NBU and supervisory statistics as of December 1, 2023 allow to analyze the intermediate results of the reduction. Problem Statement. Determining the preliminary consequences and justifying the expediency of further gradual reduction of the NBU key rate aimed at overcoming the main problems of the monetary and credit system of Ukraine in the conditions of martial law. The purpose is the analysis of the main intermediate results of the gradual reduction of the key rate in Ukraine, which directly affect the performance of its key functions by the monetary and credit system of Ukraine, and justification of the most urgent state measures aimed at overcoming the current negative trends in the monetary sphere. Methods. General scientific and special methods are used: analysis, synthesis, grouping, description, comparison, theoretical generalization and abstract-logical. Results. The key preliminary consequences of the gradual reduction of the key rate in Ukraine are analyzed, in particular: the dynamics of refinancing attracted by banks, bank investments in NBU deposit certificates, investments of the regulator and banks in domestic government loan bonds (OVDPs), corporate and retail lending, bank deposits of households and corporations by terms and currencies, individual indicators of the foreign exchange market. Conclusions. The key positive consequences of the key rate reduction are: gradual recovery of banks' credit activity; reorientation of banks' investments from the purchase of NBU deposit certificates to increasing investments in OVDPs, which made it possible to stop emission financing of the budget deficit by the NBU; maintaining a positive yield on term deposits in the national currency, which stimulates the population to further increase the volume of bank deposits. Instead, the practice of sterilizing the "excess" liquidity of banking institutions through their purchase of overnight and three-month deposit certificates of the NBU continues and and provokes a further increase in the volume of excess liquidity of the banking system due to a fairly high level of profitability of this instrument. Expected conservation of moderate rates of inflation in the short term determines the expediency of a further gradual decrease in the level of the key rate, provided that the positive return on time deposits of the population in the national currency is maintained. To overcome the current negative trends in the monetary sphere it is advisable: to consider the possibility of reducing the yield of NBU deposit certificates to a level comparable to the yield of “short “ OVDPs; to ensure the synchronization of the yield of “new” time deposits of the population in the national currency by terms at the level of five state banks; to consider the expediency of resuming the practice of compulsory sale of part of the foreign currency earnings of exporters at the level of at least 50% during the period of martial law; to intensify the use of non-monetary methods and anti-inflation policy measures, taking into account the joint responsibility of the government and regulator for anti-inflation policy.

Financial Crises and Economic Downturns of Commercial Banks in North Rift Region, Kenya

Financial Crises and Economic Downturns of Commercial Banks in North Rift Region, Kenya

Историко-экономические предпосылки формирования института права денежного обращения до XIX в.

Large-scale changes occurring in the monetary circulation of the Russian state (the emergence of a new type of money, a system of fast payments, the transition between states to payments in national currencies, the formation of monetary unions, etc.) led to the intensive development of the institution of monetary circulation law, determining the relevance of scientific research into its formation, status and development trends. This article is devoted to the prerequisites for the formation of the institution of the law of monetary circulation, within the framework of which the formation of the fundamental principles and attributive sub-institutions of the institution of the law of monetary circulation in different periods of Russian statehood is examined.

Common factors in the returns on cryptocurrencies

We find that the three risk factors of Liu et al. (2022) capture only one-third of the variation in cryptocurrency excess returns. The remaining variation is mostly driven by a single common component that lies outside the three factor model framework. Although we cannot explain this fully using a large set of 135 global macroeconomic and financial variables as candidate proxies, the unknown common component seems to be associated with the value of fiat money. The role of the common component in cryptocurrency valuation becomes more dominant during monetary easing than during tightening periods.

Decrypting Cryptocurrencies: An Exploration of the Impact on Financial Stability

This study aims to empirically examine the relationship between cryptocurrency and various facets of the financial system. It seeks to provide a comprehensive understanding of how cryptocurrencies interact with, and influence, the stock market, the U.S. dollar’s strength, inflation rates, and traditional banking operations. This is carried out using linear regression models, Granger causality tests, case studies, including the collapse of the Futures Exchange (FTX), and the successful integration of Binance. The study unveiled a strong positive correlation between cryptocurrency market capitalization and key financial indicators like the Dow Jones Industrial Average, Consumer Price Index, and traditional banking operations. This indicates the growing significance of cryptocurrencies within the global financial landscape. However, a mild association was found with the U.S. dollar, suggesting a limited influence of cryptocurrencies on traditional fiat currencies currently. Despite certain limitations such as reliance on secondary data, methodological choices, and geographic focus, this research provides valuable insights for policymakers, financial industry stakeholders, and academic researchers, underlining the necessity for continued study into the complex interplay between cryptocurrencies and financial stability.

“GAMING THE SYSTEM”: HOW COMMUNITIES STRATEGIZE AROUND CURRENCIES, CONVERTIBILITY AND CASH TRANSFERS IN KENYA

We draw from ongoing empirical research on the evolution of community currencies in Kenya, to analyse ways through which beneficiaries of cash transfers mediated by a community cryptocurrency – Sarafu – appropriate power and assert agency to obtain optimum financial benefits of the development intervention. We found that beneficiaries of the intervention have developed a deep knowledge of converting Sarafu to donor-funded cash transfers in the national currency. Consequently, the beneficiaries innovatively game conversion rules, both as individual efforts and collective action, to increase the economic benefits they draw from the cash transfers. We argue that development beneficiaries, instead of merely being subjects of development intervention, are active makers of their own economic lives and have a profound understanding of development projects, which they creatively exploit for their own benefit. By doing so, we further argue, beneficiaries contribute to the continuous structuring of interventions by putting development agencies on their toes and forcing them to revise their approaches and strengthen weak points. We conclude that assigning agency to development beneficiaries has the theoretical benefit of unravelling and appreciating the multidirectional flows of power in development assistance. Findings call for the need to involve beneficiaries in development interventions from its very conception.<p> </p><p><strong> Article visualizations:</strong></p><p><img src="/-counters-/soc/0177/a.php" alt="Hit counter" /></p>

Limiting money: redesigning the artifact that shapes modern people

AbstractThe transdisciplinary argument in this article is that the social and ecological unsustainability of modern, globalized capitalism ultimately derives from the design of its central artifact: what Polanyi called all- or general-purpose money. The notion of a singular measure of economic value is a peculiar cultural conception that is inherently at odds with physical reality, yet it pervades modern economic thought and practice as if it were immutable. To transcend the political impasse of economic globalization, a complementary national currency (CC) exclusively for local use could distinguish a sphere of exchange and special-purpose currency for basic needs from a global sphere of more remote exchange-values. To avoid the pitfalls and failures of earlier experiments with local currencies, such a CC would require the support of national authorities, the specified objective of sustainable consumption and production, and systematic efforts to provide citizens and entrepreneurs with ample incentives to utilize it. In combining the concept of a CC with that of a universal basic income (UBI), the reform would allow their advantages to complement each other, joining the generalized scale of UBI with the potential of politically influencing consumption patterns that is inherent in CC. An essential difference in relation to earlier experiments would be that the reach of the CC would not be defined in terms of the geographical location of retailers but in terms of the derivation, relative to the consumer, of the products and services into which it could be converted. Although no such system yet exists, this should not stop us from imagining its possibilities.

О РАСШИРЕНИИ БРИКС И ЕГО ПОСЛЕДСТВИЯХ ДЛЯ УСТАНОВЛЕНИЯ МНОГОПОЛЯРНОГО МИРА

The authors describe the results of the 15th BRICS summit on August 22–24, 2023 in Johannesburg (South Africa). The article shows the prospects for the expansion of BRICS according to the «BRICS+» formula. From January 1, 2024, Egypt, Iran, the United Arab Emirates, Saudi Arabia and Ethiopia joined BRICS. The expansion of BRICS is shown as a geopolitical triumph for Russia. The article analyzes the final declaration «Johannesburg-2», which was adopted following the BRICS summit on August 22–24, 2023 and enshrines the use of the national currency in trade and the collective solution of problems related to international debt. The authors reviewed the opinions of top officials of the BRICS countries, new members, states wishing to join BRICS (the Republic of Belarus, Bolivia, Algeria, Venezuela), as well as the media on the expansion of BRICS, the principles of admitting new countries, the formation of a multipolar world, and the conduct of a special military operations in Ukraine, strengthening political cooperation between the BRICS countries, introducing a new unit of account (single currency).

A Digital Ruble Platform as an Object of Financial and Legal Regulation

The paper examines the issues of legal regulation of a digital ruble platform, which is considered as an element of the national payment system, information system, and a set of financial technologies. The author analyzes the legal nature of the information platform as a general concept for varieties of digital platforms. The conclusion is made about the need to consolidate the legislative definition of the information platform. The paper also examines the legal status of the platform operator, platform participant and platform users. It is concluded that the platform operator has a special functional function, since he is solely responsible for any processes related to the operation of the digital ruble platform. The author also focuses on the problem of blocking remote banking services due to non-compliance with legislation on combating money laundering and terrorist financing (AML/CFT). It is assumed that the judicial practice concerning challenging the blocking of remote banking services will not change due to the introduction of the digital form of the national currency. It is pointed out that there are no agreements on interaction between the Bank of Russia and Rosfinmonitoring in terms of control measures under AML/CFT in the circulation of the digital form of the national currency, since the relevant risks have not been examined. It is concluded that cross-border money transfers in the form of digital national currencies are promising, but the author determines a number of problems related to the technical feasibility and legal regulation of the processes of opening accounts for non-residents and transferring funds.

Modern Monetary Theory and Energy Conservation: An Institutionalist Approach to Fiscal Policy and Energy Conservation

Abstract: This paper will set out to develop a policy proposal that is couched in the Modern Monetary Theory (MMT) framework of fiscal policy analysis. MMT teaches us that a sovereign government that issues a free-floating currency is not bound by the tenets of what can be termed “sound finance.” Sound finance suggests that all government spending is preceded by the taxing or borrowing of the currency being spent. According to MMT, since the currency is issued by the sovereign nation during the process of spending, then this spending must take place before any taxing or borrowing is done. A federal deficit is not something to be eliminated but is the normal situation, with inflation being the only real measure of spending exceeding economic capacity. Sovereign governments are currency issuers, and the money has value if the government is willing to accept it in payment to itself. This creates policy space for spending programs that are socially and ecologically beneficial. Similarly on the tax side, there is policy space to structure the tax system in a politically determined way. The tax system is one way in which the citizens of a nation engage economically with the government. The tax obligation serves as a value anchor for the fiat currency. The tax system can be designed to incentivize behavior in line with a more ecologically sustainable future. This paper will suggest that by taxing living space in a progressive manner, multiple social and economic goals can be accomplished as the economy is transitioning toward a more environmentally sustainable future.