Russia is reportedly set to begin experiments on cryptocurrency exchanges and token transactions for cross-border payments to mitigate the impact of international sanctions.
Russia appears to be days away from starting trials of cryptocurrency exchanges and token transactions for cross-border transactions in an attempt to bypass the challenges it faces under international sanctions, according to Bloomberg. I learnedCiting informed sources.
The trials, set to begin on September 1, will involve using the national payment card system to facilitate exchanges between the Russian ruble and cryptocurrencies, the sources said. The initiative follows recent legislation passed by the Russian parliament that legalizes cryptocurrency mining and sets a framework for testing digital tokens for cross-border payments under the supervision of the central bank.
The move comes as Russian companies face increasing difficulties in paying foreign suppliers and receiving payments for exports due to sanctions. Some major Russian metal producers have already started using stablecoins in transactions with China, where traditional payment methods have become restricted.
In mid-August, reports indicated that Russia was planning to create at least two domestic cryptocurrency exchanges, with one likely to use the infrastructure of the St. Petersburg International Trade Exchange and the other possibly based in Moscow, although details remain unclear.
The National Payment Card System, created by the central bank in 2014, operates Mir cards and Russian interbank instant payment systems. Officials chose the network for cryptocurrency exchange trials because of its existing infrastructure, which includes interbank clearing and settlement capabilities, the sources said.
If the trials are successful, they could lead to the Moscow and St. Petersburg Stock Exchanges launching crypto platforms next year, the sources added. The experiment would allow the use of any existing cryptocurrency, according to people familiar with the plans.