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According to reports, Russia’s Finance Ministry has started collaborating with “friendly” governments to create a cross-border stablecoin-based payments platform.
Russia To Turn To Stablecoins
According to Russian state news outlet Tass, deputy finance minister Alexey Moiseyev today said the nation is investigating stablecoins to make payments with “friendly countries.”
Moiseyev further suggested that the stablecoins are linked to commodities rather than fiat money.
“We are currently working with a number of countries to create bilateral platforms in order not to use dollars and euros. Stablecoins can be pegged to some generally recognized instrument, for example, gold, the value of which is clear and observable for all participants.”
It’s uncertain if these stablecoins will cater to institutional and governmental users instead than retail consumers. However, it appears that people are not the target market for these stablecoins given that Moiseyev compares the services now in development to clearing platforms.
Additionally, it is unknown which nations Russia might be dealing with.
The news from today comes just one day after the central bank and finance ministry of Russia decided to allow international cryptocurrency payments. They admitted that it was necessary to do so because many Russians currently use foreign crypto services.
Western Sanctions Forcing Russia’s Hands
Stablecoins are being explored as alternative payment methods by Russia due to the growing sanctions imposed on the country by Western countries.
While the U.S. Office of Foreign Assets Control included a number of Russian businesses and nationals to its list of Specially Designated Nationals, the EU said in March that it intended to withdraw many Russian banks from the SWIFT system.
A low-risk stablecoin could be adequate for usage if international sanctions increase, according to an earlier July agreement between Russia’s Central Bank and Ministry of Finance.
Ivan Chebeskov, the head of the ministry of finance, asserted that a workable stablecoin might be backed by the “ruble,” the money of Russia, or by any tangible assets like gold, oil, or grains to ensure redemptions at face value.
BTC/USD falls to $18k. Source: TradingView
Since cryptocurrencies have shown to be a useful tool for avoiding sanctions, the Russian Ministry of Finance has been attempting to make the nation more crypto-friendly.
The “on digital currency” measure, which will legitimize cryptocurrency as a method of payment and validate it as an investment class, was apparently in the works at the Finance Ministry in April.
Russian authorities are open to authorizing the use of cryptocurrencies for foreign payments, according to a senior official of the Central Bank of Russia.
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