Russia has turned to cryptocurrencies to facilitate oil trade with China and India, effectively bypassing Western sanctions in its 192 billion dollar trade, Reuters reported, citing sources familiar with the issue.
The country has slowly deepened in the cryptocurrency space. This week, the Russian Bank submitted proposals to create an experimental legal regime (ELR) lasting three years, allowing a “limited group of Russian investors” to exchange cryptocurrencies.
Some Russian oil companies use bitcoin, ether and stablecoins such as Tether (USDT) to convert payments made to Chinese Yuan and Indian rupees into rubles, according to the Reuters report. These transactions currently represent a fraction of the oil trade in Russia.
Other sanctioned countries, including Iran and Venezuela, have used the crypto to maintain trade while avoiding dependence on the US dollar, the dominant currency in the world’s oil markets.
Russia has developed several payment systems to sail in sanctions, and Crypto is one of the many tools that the country uses. Fiduciary currencies remain the main method used in oil transactions in Russia, and other bypass solutions include the use of currencies such as the United Arab Emirates, Reuters said.
The report also added that even if sanctions were lifted, Russia would probably continue to use crypto in its oil trades because it is considered a practical and flexible tool. The country, on the other hand, is currently looking to obtain its largest banks to support a digital ruble for commercial and commercial use.
The Russian Bank said that a digital currency of the central bank supported by the ruble could be used as a tool against sanctions in 2021.
Find out more: countries sanctioned by the United States as Iran are strongly looking at the crypto: analysis chain
