Russia is looking to accelerate the integration of cryptocurrency payments to facilitate international trade with other global powers.
As per information shared by its financial watchdog on Wednesday, the country aims to expedite the establishment of infrastructure for cryptocurrency payments while carefully weighing the associated risks.
This recent development in Moscow precedes the upcoming parliamentary vote on cryptocurrency legislation, scheduled for review on July 23rd.
Russian regulators believe establishing a dependable crypto payment system will assist them in dealing with international trade sanctions.
Additionally, the country has recently encountered difficulties and interruptions in international payments with major trading partners like Turkey, India, China, and the United Arab Emirates.
The delays in global transactions are due to cautious actions taken by local banks, who are under pressure from Western regulators.
The new cryptocurrency payment infrastructure being developed by Russia will go under review by parliament on July 23.
Assuming the terms and conditions of the new policies are passed, it will allow the use of crypto transactions in international payments to maintain trade flows between Russia and its partners.
Yuri Chekhanchin, the head of the watchdog, mentioned that Russia is unable to address this problem using conventional methods.
As a result, they have turned to using cryptocurrencies for making payments.
Notably, countries like Venezuela are already using cryptocurrencies for international transactions to circumvent sanctions imposed by the Western world.
United States lawmakers and representatives have brought this issue to the attention of the Biden administration, pressing for solutions to close the sanctions loophole.
“This is a need for businesses, especially in cases involving sanction mechanisms, when they need to enter the international market, and it can't always be resolved through standard methods,” Yuri Chekhanchin said.
The major risk Chekhanchin identified is the loose cryptocurrency legislation in some countries, although regulators promise to meet the challenges.
Russia's Crypto Ban and Putin's Next Move
Amidst Russia's trade sanctions, it is important to point out their ban on digital assets.
In 2022, President Putin enacted a law that bans the use of cryptocurrency for payments in Russia.
Then, in April 2024, the country imposed strict limitations on the use of crypto assets like Bitcoin.
Russia crypto revenue | Statista
Russia aims to regulate the crypto industry by permitting only digital financial assets created within its borders, with an exception for miners.
“Digital financial assets issued in Russian jurisdiction, and digital rubles will be allowed. The need for restrictions is because today cryptocurrency – is a quasi-currency that replaces the ruble in the country. But only the Russian ruble fulfills the mission of the monetary unit, so this decision has been made. From September 1, restrictions will be introduced,” Anatoly Aksakov, Chairman of the State Duma Committee on the Financial Market said.
Assuming the new legislation is approved after the review on the 23rd, it won't have any effect on the Russia crypto ban.
Instead, it will only enhance the government's international transactions with cryptocurrencies.
Hence, the objective is to break free from international trade sanctions rather than to enable internal crypto transactions.