- Russia uses Bitcoin, Ethereum and Tether in his oil trade with China and India to avoid western sanctions.
- ROsian oil exporters convert yuan and rupees in cryptocurrencies before exchanging them in ruble to make the transactions more smoothly and avoid restrictions.
Russia is now going to use cryptocurrencies for oil trade with China and India to avoid the sanctions imposed by the West. Loud Reuters have introduced some Russian oil companies Bitcoin, Ethereum and StableCoins such as Tether to exchange the Chinese Yuan and the Indian rupie for Russian rubles.
Although this is currently only a small part of the oil transactions, this practice in Russia is on the rise. According to the international energy agency, the global oil transactions were $ 192 billion last year. By using digital assets, companies in Russia are able to mitigate the effects of sanctions and to handle cross -border payments faster.
A normal transaction is that a Chinese dealer concludes a contract with a trading company and pays you via an offshore bank account in Yuan. The intermediary then exchanges the money into cryptocurrency and sends it to another account before it reaches Russia. There she is converted back into ruble. According to sources, a Russian oil dealer is handling crypto transactions worth several $ 10 million every month.
We recently reported that the Bank of Russia has proposed guidelines for investments in the field of digital assets on an experimental legal basis for a period of three years. The proposed plan stipulates that investors are limited to those who meet certain requirements, namely the possession of securities and deposits of over 100 million rubles and an annual income of over 50 million rubles. However, the Russian experiment of oil trade with cryptocurrencies is not only an exercise to avoid sanctions, but could also be a harbinger of future cooperation with the United States.
Worldwide introduction of cryptocurrencies in sanctioned oil trade
Russia is not the only country that relies on digital assets to facilitate oil trade. Iran and Venezuela also tried to use cryptocurrencies, especially in their international business, to reduce the use of the US dollar. These sanctions have caused the countries to find other methods to maintain their economy and export oil.
Bolivia has taken similar steps. As CNF reported, the state -owned Bolivian energy company Yacimientos Petrolíferos Fiscales Bolivianos (YPFB) has received permission to pay fuel imports with cryptocurrency. Specifically, you have to complete further transactions, although all the necessary preparations have been made. The plan aims to maintain the fuel subsidies, since domestic production drops and lack of foreign exchange slows down imports.
India and the United Arab Emirates (VAE) recently handled their first crude oil business away from the US dollar. Trading was handled by the XRP Ledger System’s cryptotrading find (CTF), a platform that improves financial standards and optimized the flow of money.
The Brics Alliance, consisting of Brazil, Russia, India, China and South Africa, strives to reduce the dependency on the US dollar in international transactions. The recently signed crude oil agreement between India and the VAE is a good example of this trend. These countries keep the transaction and processing costs low by relying on local currencies and blockchain-based platforms.
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