Russian Business Leaders Propose Using Digital Assets for International Trade
Russian business leaders have been discussing the use of “digital assets” and a “single digital currency” to facilitate trade with BRICS members and other friendly nations. The idea of a BRICS digital fiat currency has also been suggested by experts in Brazil, with a potential launch within the next five to 10 years.
According to Bankovskoye Obozrenie, the Russian Chamber of Commerce and Industry’s Council on Financial, Industrial, and Investment Policy has had repeated discussions on this matter. Yulia Prikhodina, the Council’s Deputy Chair, stated that experts and Chamber of Commerce members have proposed using “digital financial assets (DFAs)” for international payments.
The Council has not only discussed the use of DFAs in international payments but has also explored the creation and adoption of a single digital currency for cross-border transactions within the BRICS. Additionally, they aim to utilize DFAs or a digital fiat currency for trade with the Commonwealth of Independent States (CIS) and the Eurasian Economic Union economic blocs.
Prikhodina emphasized that using DFAs or a common digital currency instead of foreign currencies like USD would help ensure uninterrupted export-import transactions in Russia, especially amid ongoing Western-led sanctions targeting Russian trade.
However, there is confusion surrounding the term DFAs in Russian political circles as it is used interchangeably to refer to various assets such as digitized commodities, central bank digital currencies (CBDCs), digital securities, NFTs, cryptoassets, and stablecoins like USDT and Bitcoin (BTC).
Recognizing this ambiguity, Prikhodina called for clarification in official terminology to avoid confusion among experts. She stressed the need to solve this problem since Russian law does not use terms like “NFTs.”
Russia Explores Digital Financial Assets and Digital RUB-powered Trade
The Council recently formed a cooperation agreement with the Plekhanov Russian University of Economics to conduct a global study on CBDC-related regulations and legislation in friendly countries.
These countries include Belarus, Turkey, Kazakhstan, India, Iran, Mongolia, UAE, China, and Qatar. Belarus has expressed its willingness to align its CBDC plans with Moscow’s digital ruble project. Meanwhile, China is moving its CBDC interoperability efforts to the private sector as its digital yuan pilot progresses.
Although some parts of the Russian banking sector have criticized the digital ruble project, claiming that customers are skeptical of CBDCs, there are signs of acceptance. Sinara Bank’s Retail Business Development chief, Alexey Lutsenko, stated that banks need to adapt to the new reality and learn how to provide good service using the digital ruble while explaining its features and advantages to clients.
Hot Take: Russia Paving the Way for Digital Asset Adoption in International Trade
Russian business leaders’ proposal to use digital assets and a single digital currency for international trade demonstrates their commitment to embracing innovative solutions in the financial realm. By exploring the possibilities of digital financial assets (DFAs) and a BRICS digital fiat currency, Russia aims to ensure uninterrupted trade amid ongoing Western-led sanctions.
This forward-thinking approach aligns with global trends towards adopting central bank digital currencies (CBDCs) and leveraging blockchain technology for cross-border transactions. Collaborations with other nations and conducting global studies on CBDC-related regulations highlight Russia’s efforts to position itself at the forefront of this emerging landscape.
However, clear terminology is crucial to avoid confusion and facilitate effective communication among experts. Resolving this issue will contribute to the development of a robust digital asset ecosystem that benefits not only Russia but also its international trading partners.
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