Russia to Experiment with Crypto for External Settlements

The Bank of Russia announced this week that it will begin an experiment to allow the use of cryptocurrency for external settlements.

The Bank reiterated that the domestic use of cryptocurrencies would still be prohibited.

Head of the Central Bank of the Russian Federation, Elvira Nabiullina, told Russian news outlet Tass that the Bank planned to create “authorized organizations” through which mining and settlements will take place

The Russian Central Bank will work with the government to determine which organizations will be involved in mining and settlements with foreign entities.

“In the framework of the experimental legal regime, an analysis will be made of what kind of organizations they can be. Now, together with the government, a discussion is underway to understand their sphere of activity, which banks they are served by, and to what extent they can interact with representatives engaged in foreign trade activities. Later, the name will be understood,” Guznov noted. During the first stage, a company with state participation can act as such an organization. “It is not excluded that private companies may follow later,” the Deputy Chairman added.

See Also

Ripple CEO says US regulators “adding confusion” to the crypto marketplace

The Ministry of Finance and the Central Bank have agreed that cross-border settlements in cryptocurrency are necessary due to sanctions imposed on Russia, due to the war in Ukraine.

It remains to be seen how the experiment will play out. The use of cryptocurrency for external settlements could potentially provide a boost to Russia’s economy, as it would allow for faster and more efficient international transactions.