- Russia approves bills to formalize international cryptocurrency payments by September.
- The bill also established regulations for cryptocurrency mining with energy restrictions.
Russia is on track to introduce cryptocurrency for international payments by September.
The first international cryptocurrency payments can be expected by the end of the year. reported Reuters, citing Russian Central Bank Governor Elvira Nabiullina.
The outlook was based on the passage of a major bill allowing the use of cryptos in cross-border trade. Commenting on the passage of the bill, the head of the State Duma said:
“We are making a historic financial decision.”
Will Russia’s Crypto Plan Ease Sanctions?
The report linked Russian crypto development to plans to ease financial pressure from Western sanctions.
Apparently, Russia has been experiencing payment delays, especially with major trading partners such as China, India and the UAE.
According to the report, a large portion of international transfers from these trading partners were made through the international SWIFT system. Therefore, they were under pressure to follow Western sanctions against Russia.
Despite the fact that trading partners are advocating the use of local currencies, including the BRICS countries, caution and secondary sanctions from partners have made things difficult for the Russian economy.
This has affected imports, as noted by Elvira Nabiullina.
“The risks of secondary sanctions have increased. They make payments for imports difficult, and that concerns a wide range of goods.”
According to the Reuters report, the delays have led to an 8% drop in Russian imports, a major risk to the Russian economy.
As such, using cryptocurrencies for international payments could help mitigate the above-mentioned challenges. The new bill that paved the way for this expected adoption also included regulations for cryptocurrency mining.
Companies that want to mine digital assets in Russia must comply with legal requirements and the established energy limit reported Through Tass, a Russian news agency.
“Individuals who do not exceed energy consumption limits set by the Russian government will be granted the right to mine digital currencies without being included in the registry.”
Russian President Vladimir Putin earlier echoed the strict energy limit used by cryptocurrency miners. The president had expressed concern that cryptocurrency mining could lead to energy shortages.
The market is waiting to see how Russian law will develop from September and whether more Russian trading partners will agree to international cryptocurrency payments.