The adoption of cryptocurrencies was one of the main discussions among BRICS member states at a business forum held in Moscow on Friday.
BRICS group The bloc (Brazil, Russia, India, China and South Africa) seeks to reduce its dependence on Western financial systems by offering an alternative payment system to the SWIFT payment network.
Encouraging the adoption of digital currency
During the forum, Russian President Vladimir Putin He urged BRICS members to embrace this Cryptocurrencies and other digital money in their financial transactions to reduce their dependence on the US dollar.
Putin believes that BRICS and other developing countries could benefit from adopting digital currencies, saying he would push the economic bloc to explore this possibility.
Just in: BRICS uses digital currencies to develop investment. pic.twitter.com/i7u7JFsC55
– BRICS News (@BRICSinfo) October 18, 2024
He said that BRICS member countries will talk about the use of digital currencies in them Investment developmentsAdding that BRICS members are not the only ones who will benefit from the adoption of cryptocurrencies, but “other developing and emerging economies” as well.
However, he realized that comprehensive regulations must be created first while highlighting the importance of formulating a strong framework for BRICS countries to govern before diving into crypto adoption.
Cryptocurrency adoption is on the rise
An increasing number of economies are adopting digital money such as cryptocurrencies because they can be used to bypass traditional banking systems.
Others also adopt the so-called Central bank digital currencies (CBDCs), digital versions of their country’s currency. CBDCs are typically issued and regulated by their own central bank.
Two BRICS member countries, Russia and China, have already explored the use of digital currencies.
Russia announced that it will begin beta testing of the digital ruble in July next year. Under the pilot implementation, selected individuals and companies will participate in the pilot where they will make purchases using the digital ruble.
On the other hand, China has made significant progress in this area through digital currency electronic payment (DCEP). DCEP, also known as e-CNY, is a digital currency launched by the Chinese government and currently managed by the Chinese central bank. It is China’s response to public demand for modern payment solutions.
At the end of 2021, about 261 million individual wallets were opened through the initiative and transactions worth CNY 87.565 billion were conducted.
BreakPay service was launched
Aside from digital currencies, BRICS introduced a new payment platform that would challenge the SWIFT financial system.
Member states officially unveiled the BRICS Pay system, which is considered a milestone in revolutionizing financial transactions among BRICS members. The blockchain platform will streamline cross-border transactions within the bloc, serving as an alternative to SWIFT and evading US sanctions.
Moreover, the BRICSBAY initiative reflects the aspirations of its bloc members to create a self-reliant economic framework freed from the control of traditional power structures.
Featured image from The Moscow TimesChart from TradingView