Russia is looking at creating its own digital currency called a “stablecoin” to help with buying and selling goods across borders. This idea comes as the country continues to face tough international sanctions that limit how it can move money around the world. One major issue is that Russia has been blocked from using SWIFT, a global system that helps countries transfer money securely.
Because of this, Russia has been trying different ways to continue international trade. One way has been using digital currencies like stablecoins.
Stablecoins are special cryptocurrencies designed to stay steady in value. Unlike Bitcoin, which changes in price a lot, stablecoins are often tied to strong currencies like the US dollar. One of the most used stablecoins is Tether (USDT).
Tether became popular in Russia for moving money around. But in March, something happened that raised alarm. Tether froze around $28.5 million in digital money that belonged to a Russian crypto exchange that had been sanctioned. After that, the exchange had to stop offering its services. This event made Russian officials realize they can’t fully trust stablecoins made by other countries.
As a result, Russian leaders are now thinking about making their own version of a stablecoin. This would be similar to what the United Arab Emirates recently did by launching a stablecoin based on their currency, the dirham. That coin, known as AE Coin, is approved by the UAE’s central bank.
Stablecoin and Token Projects Already in Motion
The idea of using digital currencies for international trade isn’t new in Russia. In fact, the country already has two special programs in place to explore these options. One of them is called the Digital Financial Asset (DFA) program. This started even before Russia’s invasion of Ukraine. Under this system, Russia allows the creation of tokenized versions of real-world items like gold or oil.
These tokens can act like digital versions of those goods and can be used for payments, including across borders. While the DFA system was first meant for local investments, laws were changed last year so that these digital assets can now be used for international trade.
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There’s one catch, though. If someone from another country wants to hold these Russian digital tokens, they must work with Russian banks. That makes it harder for foreign buyers to use the system freely. Still, Russia is working with other countries, like Iran, to figure out how these tokens can be used for paying each other in trade.
On top of that, a new experimental program started last year in Russia. This one focuses on allowing regular cryptocurrencies, like Bitcoin and Ethereum, to be used for imports and exports. While Russia’s central bank wasn’t a big fan of cryptocurrencies in the past, it has started to show some support under this pilot project.
By December of last year, Russia had already tested some international payments using these cryptocurrencies. The officials say those tests went well and that more transactions are happening now using this new method.
Multiple Digital Efforts Underway
While the stablecoin idea is still being discussed, Russia is also working on other digital currency projects. One of them is the digital ruble, a type of central bank digital currency (CBDC). This is a digital version of Russia’s own money, managed and controlled by the central bank. It’s still in development, but it’s part of Russia’s wider plan to modernize its financial systems.
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Another idea that’s being talked about is the BRICS Bridge. This would be a new payment system that allows countries in the BRICS group — which now includes ten member states — to trade with each other using their own local currencies. The system would use CBDCs to make the payments quicker and safer.
There were even earlier reports that Russia might issue a stablecoin tied to China’s yuan or a mix of currencies used by BRICS countries. However, it’s still unclear whether China would support using its currency in this way. For now, many of Russia’s international payments are already being done using the yuan.
Officials say proposals have also been made to allow cryptocurrency trading within Russia under certain rules. With more pilot programs and tests now underway, Russia appears to be pushing ahead with digital tools to keep its trade flowing — despite the roadblocks caused by international sanctions.
