Russia Is Creating International Trade Systems Using Crypto
Russia is planning to use digital currencies for international trade, likely due to the restrictions of foreign sanctions.
Russia’s stance on cryptocurrencies has been confusing, to say the least. On one hand, Russia seems to be anti-crypto: government agencies have moved to explicitly ban trading Bitcoin across the country’s borders only to have it immediately reversed, and there have been statements suggesting that Russian Bitcoin mining could be banned. On the other hand, Russia is sometimes pro-crypto: the government is fully aware that it can avoid sanctions by embracing cryptocurrency transactions and bring money into the country by allowing cryptocurrency mining, particularly mining Bitcoin. Last fall, Russia contributed roughly 11% of all the mining hashrate on the Bitcoin network.
What is Russia’s Cryptocurrency Policy?
Over the past year or so, it seems like Russia’s embrace of cryptocurrency for international transactions has gone from “maybe” to “eventually.” Putin put out statements supporting Bitcoin mining, and government officials have publicly floated the idea of accepting oil payments in Bitcoin. Russian sources are now putting out statements from a series of government representatives that Bitcoin-fueled international trading may become a reality as early as 2023.
The Russian Prime Minister has been pushing for coordinated efforts between government institutions to control how crypto is issued and used within the country. At the same time, Russian central bankers are being pressured to create regulatory frameworks for how the Russian Central Bank Digital Currency (CBDC) will be budgeted.
That’s about where the cooperation ends though. There have been statements by officials suggesting a wide range of when Russia might have a real regulatory framework in place. Some are saying it’s years away, others think it will come in 2023. Today, they’re still not unified on if it is a currency, a commodity, a collectible, or a security.