Russia is beginning the era of cryptocurrencies in payments.
While the US continues to tighten its sanctions on Russia, the problems of Russian companies in receiving and sending payments in international trade continue to plague the government.
Russian officials, who are looking for alternatives to solve the problem, are now taking a much more moderate approach to cryptocurrencies, where they have shown a harsh stance in the country for a while.
In 2022, the Central Bank of Russia demanded the complete ban of cryptocurrencies in the country with a report prepared just before the war, but cryptocurrencies became increasingly common due to the removal of Russian banks from the SWIFT payment system after the Ukraine war.
With the decree signed by Russian President Vladimir Putin on August 8, the experimental use of cryptocurrencies in international payments and Forex transactions was legalized. Accordingly, the Central Bank of Russia will oversee the process, which will start on September 1.
The head of the Central Bank of Russia, Elvira Nabiullina, said on July 30 that the use of cryptocurrencies in international payments could begin by the end of the year.
Russian Finance Minister Anton Siluanov said on Aug. 14 that they are working to legalize cryptocurrency exchanges.
However, since a large number of countries have developed their own rules for cryptocurrencies, how to use cryptocurrencies in international trade and the security of this system remains unclear.
National payment card system will become important
Experts say that the National Payment Card System, which Russia started to develop in 2014, will come to the fore during the trial process on cryptocurrencies.
While it is emphasized that the Central Bank of Russia has full control over the National Payment Card System plays an important role in this preference, the country's domestic payment system Mir is also working on this platform.
The main type of cryptocurrency projected to be used in international payments is expected to be stable coins.
Stable coins are expressed as cryptocurrencies whose value is tied to another asset in fiat money, commodities, such as dollars or yuan, or cryptocurrencies such as Bitcoin.
The Central Bank of Russia, in its report published on July 10, reported that an evaluation was made for the establishment of a mechanism that will determine the rules for the circulation of stablecoins in the country.
While Russia needs the support of BRICS countries, especially in terms of the use of cryptocurrencies in international trade, officials in Brazil, South Africa and India have made statements that they are working on this issue. In China, the use of cryptocurrencies was banned.
The study, published by the Russian-based Transstroy Bank, pointed out that the use of cryptocurrencies in international payments creates new opportunities for business and the economy.
However, the report, which includes a number of challenges related to the process, emphasized that the restrictions imposed by the regulators in the countries, technical complexity and fluctuations in the value of cryptocurrencies are among the challenges.
The trials of the digital ruble are underway
While the Central Bank of Russia's trial process for the digital ruble was launched last year, the digital ruble is expected to progress in an integrated way with the cryptocurrency process.
Taking the development of the digital yuan as an example, Russia hopes to use cryptocurrencies and the digital ruble for payments with China, its biggest partner in trading.
Anatoly Aksakov, chairman of the Financial Markets Committee of the lower house of the Russian parliament Duma ⁇ , told the Russian news agency in June, ⁇ Both we and they have a certain experience, so it may be interesting to start the process of payment in digital currencies with China. Technologically, we're pretty close. Since it is a friendly country, it will be possible to try it with Belarus ⁇ . ⁇ he said.
The digital ruble, the trial period of which has been ongoing since August 2023, is currently used in a limited way in about 30 companies and 11 cities.
For example, the digital ruble used by the oil company Lukoil ⁇ in in some gas stations is also accepted as a form of payment in the Moscow Metro.
The head of the Central Bank of Russia, Nabiullina, said that the digital ruble will become an important part of life in 5 years.
At Putin's meeting in Moscow on July 17, this is essentially another form of our national currency. Its feature is that citizens and businesses can use the digital ruble regardless of which bank they have an account with.
Emphasizing the need to expand the digital ruble, Putin instructed to accelerate the work aimed at its use especially in financial and economic activities.
Experts state that in order for Russia to be able to use the digital ruble for international payments, first of all, the trial process must be successfully completed in the domestic market.
