BRICS: Russia Exploring Crypto For International Payments

Russia's central bank has urged businesses to explore alternative methods for cross-border payments, including cryptocurrencies and digital assets, to mitigate the impact of Western sanctions.

These sanctions were imposed following Russia’s invasion of Ukraine in February 2022, which led to significant challenges for Russian businesses in settling international payments. Central Bank Governor Elvira Nabiullina stressed the importance of adopting crypto solutions to overcome these obstacles.

Nabiullina highlighted the difficulties that Russian enterprises face when conducting cross-border transactions, even with partners from countries such as India, China, the UAE and Turkey that have not imposed sanctions. Key financial institutions, such as the Moscow Stock Exchange and SWIFT, are constrained by sanctions, making international payments more difficult.

Speaking at a financial conference in St. Petersburg, Nabiullina noted that new financial technologies offer previously unavailable options, leading to a more lenient stance on the use of cryptocurrencies for international payments. She mentioned that businesses have become innovative and are finding ways to deal with these limitations, often without informing the authorities.

Some Russian companies have already started using cryptocurrencies for transactions with international partners, especially in China. Nabiullina also revealed that Russia and other BRICS countries – Brazil, India, China and South Africa – are discussing the creation of a new payment system that would bypass Western institutions.

She acknowledged the challenges and potential interference from Western countries, pointing out that the creation of such a system would take time.