Russian Businesses Using Crypto to Avoid Western Sanctions
As we’ve reported, the Russian government isn’t really using crypto to get around onerous Western sanctions, which ironically end up hurting Western powers far more than they do Russia. (Just ask the average northern European how they’re looking forward to winter with their energy crisis. Even in southern Europe, places like Italy are already instituting rationing.)
The Russian government is using TradFi to get around the West’s actions. Russian businesses, however, are taking advantage of the decentralization and censorship resistance crypto affords, and to go measure.
Russian businesses operating within the Russian Federation have begun to use cryptocurrencies to circumvent sanctions in cross-border transactions, according to the Ministry of Finance.
Russian businesses are already getting around sanctions with the help of cryptocurrencies. This is despite the fact regulation of the crypto scene in the Russian Federation has not yet been properly configured.
This was stated in an interview by the director of the financial policy department of the Ministry of Finance, Ivan Chebeskov.
Vladimir Gamza is the head of the Chamber of Commerce and Industry of the Russian Federation. He said that business in the Russian Federation mainly uses cryptocurrency for transactions with unfriendly countries (USA, Ukraine, Norway, Singapore and others).
The Russian government is looking into ways to implement its “digital ruble” – a central bank digital currency (CBDC) which as we’ve written carries its own problems – but for now decentralized digital assets rule the day.
Despite the Russian authority’s positive sentiment towards using cryptocurrencies abroad, the Central Bank of the Russian Federation is not as optimistic. Instead of cryptocurrencies, the Central Bank of the Russian Federation wants to see the use of the digital ruble, which is currently being tested among a limited group of Russian banks.
Elvira Nabiullina is the head of the Central Bank of the Russian Federation. She said the financial mega-regulator intends to promote the digital ruble for cross-border transactions. There is already work being done on a prototype system for interfacing with other monetary systems. However, she acknowledged that the implementation of the system depends not so much on the Russian Federation, but on the readiness of the other side. So, it is not clear how popular the digital ruble will be for such purposes.