Russia’s Central Bank Advocates Cryptocurrencies, BRICS Currency a Long Shot
Russia’s Central Bank Recommends Cryptocurrencies to Counter Sanctions
Russia’s central bank has advised businesses to use various solutions, including cryptocurrencies and digital assets, for payments with foreign partners. This move aims to counter Western sanctions imposed due to the Ukraine conflict.
Trade Setbacks with Non-Sanctioning Countries
Russia’s trade with China, India, the UAE, Turkey, and other non-sanctioning countries has faced major setbacks recently. The latest Western sanctions target major Russian financial institutions, including the Moscow Stock Exchange and Russia’s alternative to the SWIFT global payments system.
Central Bank’s Response to Payments Challenges
As reported by Reuters, Elvira Nabiullina, governor of the central bank, highlighted payments problems as a key challenge for Russia’s economy. Speaking at a financial conference in St. Petersburg, she noted that new financial technology offers unprecedented opportunities. “We softened our stance on using cryptocurrencies in international payments, allowing digital assets in such payments,” Nabiullina said.
Emerging Global Payments Systems
Nabiullina also mentioned that Russia’s business partners were under “tremendous pressure.” She predicted a new global payments system not involving Western institutions would emerge over time. Discussions are ongoing among BRICS countries about the BRICS Bridge payments system, intended to link the financial systems of member countries. However, Nabiullina acknowledged these discussions are challenging and will take time to yield results. She also hinted that the BRICS currency project is a long shot and may not materialize soon.
Sensitive Information on Payment Mechanisms
Andrei Kostin, head of Russia’s second-largest lender VTB, recently sanctioned in Shanghai, suggested that any information on mechanisms to facilitate international payments should be classified as a “state secret” due to its sensitivity.
