The Russian government has just taken a significant step in bypassing global sanctions by passing new laws to allow businesses to use Bitcoin for international trade payments.
Russian lawmakers passed a bill on Tuesday that will allow businesses to use cryptocurrencies in international trade.
The move is part of Russia’s efforts to skirt Western sanctions imposed after the nation’s invasion of Ukraine.
The law is expected to go into force in September.
Russian Central Bank Governor Elvira Nabiullina, one of the backers of the new law, said the first transactions in cryptocurrencies will take place before the end of the year.
JUST IN: 🇷🇺 Russian law makers passes bill allowing businesses to use #Bitcoin and cryptocurrencies in international trade — Reuters pic.twitter.com/yFExWcIG9k
— Bitcoin Magazine (@BitcoinMagazine) July 30, 2024
Russia has faced significant delays in international payments with major trading partners such as China, India, and the United Arab Emirates.
Banks in those countries, under pressure from Western regulators, became more cautious about dealing with Russia.
“We are taking a historic decision in the financial sphere,” the head of Russia’s Duma lower house of parliament, Anatoly Aksakov, told lawmakers.
Under the new law, the central bank will create a new “experimental” infrastructure for cryptocurrency payments.
Details of the infrastructure have yet to be announced.
The law is part of a package that also includes regulations on the mining of cryptocurrencies and the circulation of other digital assets.
The new law will not lift an existing ban on cryptocurrency payments inside Russia, however.
The central bank said that delays in payments have become a major challenge for the Russian economy.
The delays have led to an 8% decline in Russian imports in the second quarter of 2024.
Despite Russia’s efforts to switch to the currencies of its trade partners and develop an alternative payment system within the BRICS group of emerging economies, many payments are still conducted in dollars and euros.
These payments still go through the international SWIFT system, which has blocked Russia.
This exposes banks in countries trading with Russia to the risk of secondary sanctions, forcing them to tighten their compliance procedures.
“The risks of secondary sanctions have grown,” Nabiullina said, stressing that payment delays have led to longer supply chains and rising costs.
“They make payments for imports difficult, and that concerns a wide range of goods.”
The news will be a positive development for cryptocurrency advocates, who have already been enjoying a historic announcement from President Donald Trump.
As THAIMBC News reported earlier, Trump has committed to his pledge to ban the formation of a Central Bank Digital Currency (CBDC) in America.
Trump blasted CBDCs during his speech at the Bitcoin 2024 conference in Nashville, Tennessee on Saturday.
CBDCs are considered the enemy of physical cash and decentralized cryptocurrencies such as Bitcoin.
He made his stance on CBDCs crystal clear, provoking roaring cheers of support from the massive audience.
“There will never be a CBDC while I am president,” Trump declared as he brought the house down.
This statement echoes his previous comments on the matter, where he has consistently expressed strong opposition to the idea of a CBDC.
Trump has previously called CBDCs a “dangerous threat to freedom.”
Elsewhere during his speech in Nashville, Trump outlined his plan for U.S. Bitcoin adoption via a strategic crypto reserve and an advisory council.
“I’m laying out my plan to ensure that the United States will be the crypto capital of the planet and the Bitcoin superpower of the world,” Trump pledged.
“If Bitcoin is going to the Moon — as we say— I want America to be the nation that leads the way.”
