Russia Drafts A New Law To Allow Crypto For International Trade

April 19, 2023 2:48 pm Comments

It is already well-known that there are many countries around the world that are now looking for alternatives to the USD in order to conduct international trade.

This is due to the fact that there are economic concerns related to the USD such as inflation concerns as well as sanctions.

As a result, Russia just announced that its central bank is now looking into using crypto in order to settle international trade.

So far, it looks like a draft of this new law has already been created and it is specifically for doing external trade rather than domestic purposes.

The timeline and probability of this new draft law becoming official is still unknown at this time. reports:

At an event with representatives of the New People party, the Chairman of the Central Bank, Elvira Nabiullina recently told that the regulator can use digital assets for settlements with foreign entities. Such operations will be reportedly feasible within the framework of the experiment.

As noted by Nabiullina, the central bank opposes the use of crypto within the state. However, such funds can be used for external payments.

This likely means that special institutions will be created in Russia that will engage in mining and crypto transfer to foreign structures. Such organizations will also be reportedly engaged in operations with other digital finance.

The Central Bank is parallelly consulting with the government about which institutions can be allowed to do the same. The report pointed out that these institutions will presumably be entrusted to a state company first. Moving forward, private enterprises will also be added to the picture.

What will be especially positive for the global crypto industry is if other major economies besides Russia also start to allow crypto for international trade.

If that happens, the amount of growth that is expected would be tremendous as this could include the continents of Asia, Africa, and Latin America.

As of now, international trade is still mainly done using fiat currencies such as the USD which means crypto could erode the dominance of the existing financial system.

There has not been any information on what specific crypto that Russia might use to facilitate these international settlements in the draft, but many are predicting that it is probably Bitcoin, XRP, or another token that is within the top 10.

CryptoPolitan concludes:

As countries across the globe reevaluate their chosen currencies for international transactions, two distinct trends have emerged.

While some nations are working to diminish the influence of the U.S. dollar in trade, others are embracing the potential of cryptocurrencies for settling global payments.

In a notable development, Russia is taking significant steps toward the latter approach. A recent report revealed that the Central Bank of Russia is actively considering the use of digital currencies, such as cryptocurrencies, in international settlements.

A draft law is currently being developed to facilitate this process.

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