Russia Considers Stablecoin Use for Cross-Border Payments

Liputan6.com, Jakarta – Russia is considering using stablecoins for cross-border settlement or payment. The regulations are still being worked out by the relevant authorities.

Deputy Chairman of the Bank of Russia, Alexey Guznov said, this has been proposed and the possibility of approving a stablecoin for this use case is being discussed.

However, Guznov acknowledged that some technicalities need to be worked out, including setting up the entire chain that would allow individuals and businesses to accept the digital currency, store it and then use it to settle international payments.

“The understanding is still being formed, and I hope that in the near future it will be reflected in the text of the bill,” he said, quoted from Yahoo Finance, Friday (5/7/2024).

Similarly, the Russian Finance Ministry's Press Bureau, Izvestia, said the issue is being worked on. There is a possibility that it could be activated permanently, as it happened with the approval of the Digital Financial Assets (DFA) law that was passed in March 2024.

Different Russian personalities have expressed support for the use of stablecoins, tokens pegged to the value of another asset or fiat currency (most often the US dollar), for cross-border settlements due to their versatility and lack of volatility when making payments.

Alexander Murychev, executive vice president of the Russian Union of Industrialists and Entrepreneurs, said this was “very promising” in this regard.

Hard to Track Western Countries

Meanwhile, Natalia Milchakova, a leading analyst at Freedom Finance Global, said Stablecoin transactions are difficult to track for third-country regulators, making them attractive for making payments without fear of secondary sanctions from Western countries.

These payments are already happening, albeit on a small scale. In June, reports indicated two of Russia’s top metal producers were using Tether’s USDT to pay and receive payments from Chinese counterparts.

Elvira Nabiullina, the governor of the Bank of Russia, recently stated that the institution has softened its stance on using crypto for international payments, encouraging its use to circumvent Western sanctions.

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