russia is making progress in finding and developing new ways to circumvent sanctions. In August of this year, the russian authorities adopted a law legalizing the mining of cryptocurrencies and their use in international trade. So, in September it was already reported that payment in cryptocurrency by russian companies for dual-use technologies, which are necessary for russian military-industrial complex. Let’s briefly consider the history of cryptocurrencies in the russian federation and its international partners – Brazil, China, Iran, and India.
- 02/06/2014 – russian forbids the use of cryptocurrencies in transactions because of considering the issue of classifying such transactions as operations aimed at legalizing proceeds from crime and financing terrorism.
- 03/20/2015 – the government if going to declare a law with criminal responsibility for cryptocurrency usage and storing, but decides to wait and analyze an international situation development.
- 10/20/2020 – cryptocurrencies should be declared in income statements.
- 12/2021 – A prototype of the digital ruble platform has been created.
- 01/2022 – the Bank of russia and market participants began testing the digital ruble platform.
- 07/24/2023 – An implementation law for the digital ruble was signed on, which also recognizes any digital currency as an object of contract, property and inheritance.
- 08/09/2023.- the beginning of the use of real digital rubles with the involvement of a limited number of bank clients.
- 09/2023 – The world’s largest crypto exchange Binance announced the sale of its russian business.
- 03/2024 – the rate of the BayBit crypto exchange in russia grows to 51%.
- 03/19/2024 – russia wants to create a platform for confiscating cryptocurrencies.
- 07/30/024 – The russian federation legalizes cryptocurrency mining and allows international trade transactions in cryptocurrency. Only authorized government entities and individual entrepreneurs included in a special register will be able to engage in mining. Therewith, the law prohibits the organization of wide circulation of digital currency (among an unspecified group of persons), as well as its advertising. In addition to regulating mining, the law allows, with the approval of the Central Bank, trading in foreign digital financial assets on russian blockchain platforms. It also simplifies the entry of russian digital financial assets into foreign trading platforms.
- 09/17/2024 – It has become known that russian authorities have begun to transfer trade with China to cryptocurrency.
- 2025 – russian banks will report on foreign trade payments in cryptocurrency (https://cbr.ru/statistics/pr/). MTS-Bank, Raiffeisenbank, Citibank, Soyuz Bank, UniCredit Bank, and 13 other banks will participate in the survey. Credit organizations such as Sber, VTB, and T-Bank are not included in the list published as an appendix to the Central Bank Program.
- In 2024, the country took seventh place in the global cryptocurrency adoption ranking, and in August alone, russia accounted for up to 28% of traffic on the largest crypto exchanges. Cryptocurrency turnover in russia in the first half of 2024 reached 2.3 trillion rubles.
The development of cryptocurrencies in russia is designed to reduce the impact of sanctions on the economy, as well as to strengthen trade and economic ties with the BRICS countries. These are powerful world economies that have long been looking for an alternative to the dollar as the main currency in international trade and the world’s reserve currency.
As long as USDT and USDC remain the main stablecoins of the world, the USA still has the opportunity to influence the course of events. At the same time, sanctions must be introduced with caution, because serious economic losses and restrictions aimed at limiting the development of cryptocurrency international trade, which can be implemented for a terrorist country now, will prompt it to quickly seek alternative solutions to circumvent sanctions and trade on the black market.
«In short, foreign suppliers are usually only willing to accept USDT and USDC, i.e. dollar-pegged stablecoins.” The most popular cryptocurrencies on the market – USDT and USDC – have freezing mechanisms and have been actively using them for several years.» – russians concern.
As for the other BRICS counties and Iran, the same trends are common.
China:
- 2017, the State Council approved the development of the digital RMB, in partnership with commercial banks and other organizations.
- In October 2019, the PBOC announced that a digital renminbi would be released after years of preparation.
- In April 2020, testing began in four cities around China, and in the coming years, its capacity expanded.
- From May 2023, Changshu in the province of Jiangsu started to roll out salary payments in e-CNY for government employees as well as staff at state-owned companies and public institutions.
- On July 11, 2023, the Bank of China, China Telecom, and China Unicom announced the joint launch of SIM card-based e-CNY wallets, which allow offline payments using the SIM’s NFC function. September 6, 2024 That’s equivalent to $56 billion in a month.
India:
- The pilot in the wholesale segment, known as the Digital Rupee -Wholesale (e₹-W), was launched on 1 November 2022.
- The Cryptocurrencies market in India is projected to witness significant revenue growth, reaching a staggering amount of US$6.6bn by 2024. India registered approximately $269 billion in crypto volumes between July 2022 and June 2023, demonstrating grassroots adoption.
Brasil:
- The Banco Central do Brasil (BCB, the central bank) is aiming to launch its own central bank digital currency (CBDC), the Drex, by the end of 2024.
Iran:
- The Central Bank of the Islamic Republic of Iran said today that it will begin testing the “digital rial” from June 21.
- In 2022, incoming crypto volume to Iranian exchanges approached USD 3 billion. The Cryptocurrencies market in Iran is projected to grow by 14.47% (2024-2028) resulting in a market volume of US$211.90m in 2028.
The USA and European countries should work out a new system of imposing sanctions that takes into account cryptocurrency payments. At the same time, they have a vital need to create a new cryptocurrency paradigm of international trade if they wish to maintain global economic and political supremacy. The absence of a solution to this issue allows the countries of the southern hemisphere to build up their forces for the Great Confrontation, which already seems inevitable.
