According to recent reports, the Central Bank of Russia is apparently looking into the use of digital currencies, including cryptocurrencies, in international transactions. This step is a component of Russia’s attempts to lessen the importance of the US dollar in world commerce and validate cryptocurrency transactions.
Elvira Nabiullina, the head of the Central Bank, revealed during an event with officials of the New People party that the institution may employ digital assets for settlements with foreign businesses.
“We adhere to the same position that within the country, cryptocurrency … should not be used, and for external payments we assume that this is possible in the form of an experiment, this bill is also being prepared in the form of an experimental legal regime,” said Russian media outlets.
However, Nabiullina made it clear that the central bank does not approve of citizens using cryptocurrencies for personal transactions. Instead, the focus is on using digital currencies for import/export purposes, suggesting that Russia may establish specialized entities to mine cryptocurrency and send the proceeds abroad. These institutions may also conduct business with other forms of digital money.
Reportedly, the government is in talks with the Central Bank to determine whether to grant similar privileges to other organizations. A state-owned firm may initially control these establishments, but private enterprises may be added in the future.
This decision aligns with Russia’s support for the internationalization of the Chinese yuan. Recently, President Putin highlighted that approximately two-thirds of Russian-Chinese trade uses the yuan and ruble.
Russia’s Central Bank’s decision to accept cryptocurrency for international settlements might have far-reaching consequences for the global financial system. The US dollar currently dominates international trade and is the dominant currency for international settlements.
However, the dollar’s dominance is increasingly dissatisfying several countries, prompting them to call for a diversity of payment methods used in international transactions.