Russian companies are reportedly using bitcoin and other cryptocurrencies to make international payments.
It’s a trend that follows legislative changes that have allowed these types of payments to circumvent Western sanctions, Reuters reported Tuesday, December 26, citing comments from the Russian Finance Minister Anton Siluanov.
As the report notes, the sanctions – imposed following Russia’s 2022 invasion of Ukraine – have made it more difficult for Russia to trade with partners like China and Turkey. But this year, Russia began allowing cryptocurrencies for foreign trade and is working to legalize the mining of cryptocurrencies such as bitcoin.
“Under the experimental regime, it is possible to use the bitcoins that we have mined here in Russia (in foreign trade transactions),” Siluanov told Russia 24 TV channel.
“Such transactions are already taking place. We believe they should be expanded and developed further. I am confident that this will happen next year,” he said, adding that using digital currencies to make international payments was the future.
PYMNTS explored this idea earlier this week in a report on events in the cryptocurrency/blockchain world over the past year.
“Cross-border payments, historically plagued by high fees and slow transaction times, will undergo a significant transformation in 2024,” this report states. “Blockchain technology has become a key tool, offering transparency, speed and profitability. »
Stablecoins play a key role, PYMNTS added, allowing businesses to bypass traditional banking correspondent networks and settle transactions almost instantly.
“Blockchain technology and public blockchains in particular open up a number of new use cases, one of which involves transferring value – such as remittances – from one country to another. » Raj Dhamodharanexecutive vice president, blockchain and digital assets at Mastercard, told PYMNTS.
Research by PYMNTS Intelligence found that using cryptocurrencies to make cross-border payments could be the winning use case the industry is looking for. Research shows that cross-border blockchain-based solutions, particularly stablecoins, are increasingly used by businesses looking for better ways to transact and expand internationally.
“Blockchain solutions and stablecoins – I don’t like to use the term crypto because it’s more FinTech – have found product-market fit in cross-border payments.” Sheraz ShereManaging Director of Payments and Commerce at Solana Foundationsaid in an interview here earlier this year. “You get disintermediation, you get speed, you get transparency, you get extremely low cost. »
