Russia Is Warming Up to Crypto
Last week, Putin made a statement at an AI conference suggesting Russia should host an international crypto payments system.
Russia is warming up to crypto. Last week, Putin made a statement at an AI conference suggesting Russia should host an international crypto payments system. Such a system, Putin says, would help Russia trade with the rest of the world while it's under sanctions imposed by the West. Russia is a major exporter of crude oil, natural gas, and industrial chemicals--materials every country still needs even though Russia is at war with Ukraine.
Russian lawmakers also suggested last week that Russia needs a national crypto exchange that will operate similar to a bank. A few weeks ago, Russian lawmakers introduced a bill that would legalize crypto mining in Russia while also introducing a platform for local crypto sales and allow miners to use international markets.
Russia has previously threatened to ban crypto outright, but the country's legislative branches and national bank also discussed regulating and taxing crypto. It now seems like Russia needs to adopt crypto to ensure it can execute large international trades, like exporting its oil.
To non-Russian crypto holders, this could potentially be bad long-term. US lawmakers are already a bit wary of crypto following the FTX collapse. If Russia threatens the petrodollar by selling its oil for Bitcoin, the US could respond by banning Bitcoin. To me, that sounds a bit severe, but I also didn't think the US would cut Russia out of Western finance in March after they invaded Ukraine.