Russia is launching crypto exchanges in Moscow and St. Petersburg to support digital payments.
The new stabilised tokens will be tied to the Chinese yuan, offering stability for international trade.
These moves aim to strengthen economic ties within BRICS and decrease reliance on the U.S. dollar.
Russia plans to set up two crypto trading platforms to combat U.S. sanctions that limit its access to global monetary systems. These markets will be located in Moscow and St. Petersburg. The fresh coins will be tied to the Chinese yuan, offering protection for international trade, especially among BRICS nations including Brazil, Russia, India, China, and South Africa.
To make sure that the value of the stablecoin does not shift, it will be backed 1:1 by the chinese yuan.
Russiaâs Move Towards Digital Asset Development
Russiaâs move to create these exchanges is a key step in its cryptocurrency development. The first exchange might use the St. Petersburg Currency Exchange to support foreign economic activities. The second exchange, in Moscow, could be developed on the Moscow Exchange or as a new entity under an experimental framework.
https://twitter.com/WatcherGuru/status/1826912325426700507
The main goal of these trades is to create and use stablecoins. These sabilized tokens are digital money usually tied to a national exchange rate to keep their value stable. Russia is considering linking its stablecoin to the Chinese yuan and possibly a group of BRICS currencies. This aims to boost economic cooperation within the BRICS group.
However, integrating stabilised coins into Russiaâs blockchain system is challenging. Oleg Ogienko, CEO of BitRiver, pointed out the difficulties in making stablecoins work like traditional currencies. These challenges could slow down the adoption of stablecoins in Russia.
Challenges in Regulation and Operation
Russia's cryptocurrency efforts follow Federal Law No. 259, which covers digital assets. However, this law does not clearly address the creation or operation of cryptocurrency exchanges. Yaroslav Schitzle from Rustam Kurmaev and Partners noted the lack of a clear legal path for setting up and running these exchanges.
The rollout of these exchanges will likely happen in stages. At first, access will be limited to major exporters and importers known as "blue chips." Mikhail Uspensky, a member of the expert council on cryptocurrency laws in the State Duma, said smaller businesses and individual users might not have access early on.
Launching a yuan-pegged stablecoin could help Russia bypass U.S. sanctions and reduce its reliance on the dollar. This new payment system will make the yuan and ruble key currencies in BRICS trade, potentially affecting the global financial landscape as other countries might adopt the yuan for trade settlements.
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