As the limitations of traditional financial models become increasingly prominent, the BRICS countries are actively exploring how to use cryptocurrency, an emerging tool, to build a new international payment order that is more diversified and decentralized.
Faced with the changing landscape of the global financial market, the BRICS countries (Brazil, Russia, India, China and South Africa) are seeking to introduce a new payment system to reduce their reliance on the Western-dominated SWIFT payment network. This move indicates that the BRICS countries are seeking greater autonomy and voice in the global financial system.
Cryptocurrency and digital currencies were among the hot topics discussed at the BRICS Business Forum held in Moscow last Friday.
Call for adoption of digital currency
At the recent BRICS Business Forum, Russian President Vladimir Putin proposed an important initiative on financial transactions. He suggested that BRICS countries adopt more cryptocurrencies and other digital currencies in financial transactions in order to reduce dependence on the US dollar and increase the autonomy of financial transactions in various countries.
Putin believes that such a transformation will not only benefit the BRICS countries, but will also provide other developing countries and emerging economies with new growth opportunities.
He also said that BRICS countries must consider the use of digital currency as a key consideration when formulating investment and development strategies, which marks an important step towards financial modernization.
Putin pointed out that although the introduction of digital currency is expected to bring many benefits, it is necessary to establish a comprehensive regulatory system before that. He believes that only under a sound regulatory framework can the advantages of digital currency be fully utilized.
Putin proposed at the BRICS Business Forum that member countries should jointly establish a strong regulatory framework to guide the introduction of digital currencies to ensure the security and orderliness of the process. This shows that while promoting financial innovation, BRICS countries also focus on risk control and supervision, aiming to enhance their independence and influence in the international financial system.
Cryptocurrency adoption continues to rise
Globally, more and more economies are adopting digital currencies such as cryptocurrencies, mainly because they can bypass the traditional banking system to provide more flexible financial solutions. Against this backdrop, the concept of central bank digital currency (CBDC) came into being, which is a digital version of the national currency issued and regulated by central banks of various countries.
Among the BRICS countries, Russia and China have already taken exploratory steps in the field of digital currency. Russia announced plans to launch a pilot project for the digital ruble in July next year, when selected individuals and companies will participate and use the digital ruble for transactions. This marks a substantial step forward for Russia in the application of digital currency.
At the same time, China has made significant progress with Digital Currency Electronic Payments (DCEP), the e-renminbi. DCEP is a digital currency operated by the People's Bank of China and is designed to respond to public demand for convenient payment methods. As of the end of 2021, approximately 261 million personal wallets have been opened, and the cumulative transaction volume has reached 87.565 billion yuan, showing that China has achieved great success in promoting the popularity of digital currency.
These measures show that the BRICS countries are actively embracing digital currencies in order to gain greater autonomy and competitiveness on the international financial stage. With the continuous development and application of digital currency technology, it is expected that more countries will follow suit in the future and jointly promote the transformation of the global financial system.
BRICS Pay is now live
In addition, the BRICS countries have also launched a new payment platform, BRICS Pay, which is based on blockchain technology and aims to simplify cross-border transactions between member countries, providing an alternative that does not rely on SWIFT while effectively circumventing US economic sanctions.
The official announcement of the BRICS payment system is seen as a revolutionary step for BRICS in the field of financial transactions. This move also poses a challenge to the existing SWIFT financial system.
In short, the launch of BRICS Pay marks the independent innovation of the BRICS countries in the financial field, aiming to establish a cooperation framework independent of the traditional financial system. The platform will promote settlement in local currencies of member countries, strengthen financial cooperation, and enhance the status of BRICS countries in global finance.
Conclusion:
With the launch of BRICS Pay and in-depth exploration of digital currencies, the BRICS countries are creating a revolution in the global financial sector. This is not only a challenge to the traditional financial system, but also a firm pursuit of financial autonomy and diversified payment methods. The BRICS countries are working together to build a decentralized, efficient and secure new international payment order. How will this reshape the global economic landscape? Let us wait and see!