BRICS Expands, Russia Leads Crypto Push for Sanction-Evasion Trade
The BRICS group, initially comprising Brazil, Russia, russia, India, China, and South Africa, has expanded significantly in recent years. As of early 2025, it includes Saudi Arabia, Iran, Egypt, Ethiopia, the United Arab Emirates, and Indonesia. Notably, several central banks within these countries are exploring the use of cryptocurrency technologies for international transactions to enhance trade efficiency and reduce reliance on traditional currencies.
In russia, the central bank endorses experiments with crypto payments, but restricts their use to cross-border trade and prohibits advertising. This move comes amidst increasing reliance on stablecoins like Tether (USDT) for transactions, even by companies not under sanctions. These stablecoins offer quick, low-fee transfers without involving banks, making them attractive to sanctioned entities and those facing dollar liquidity issues or capital controls.
Russian metal producers have started using Tether for transactions, even when not under sanctions, for delivering metals to China or importing machinery. Similarly, Russian commodity companies and their Chinese trading partners are increasingly turning to USDT for payments due to difficulties in executing bank transfers. Even Russian smugglers are resorting to Tether to evade sanctions on weapons and drone parts. The use of stablecoins is forcing russia and China to adopt more efficient payment systems, ahead of those used in Europe and the U.S.
However, the use of stablecoins is not without challenges. Secondary sanctions imposed by the us bank are causing problems for Russian companies trading commodities, even if they are not under sanctions themselves. Chinese banks are refusing Russian customers to avoid scrutiny of permissible transactions due to these secondary sanctions.
The expanding BRICS group is exploring cryptocurrency technologies for international transactions, with russia leading the way in experimenting with stablecoins like Tether. While these coins offer quick, low-fee transfers, they also present challenges, particularly in the face of secondary sanctions. As russia and China adopt more efficient payment systems, the international community must grapple with the implications of these developments.
Read also:
- West Virginia Governor's Revived Board Sparks Legal Concerns Amidst US Clean Energy Push
- Prices of transit tickets in Berlin and Brandenburg are on the rise
- Linde Wins Major Engineering Design Contract for Equinor's Low Carbon Hydrogen Project at H2H Saltend, Progressing Towards a Greener Future
- Economic Growth of Nitric Acid for Electronic Applications Anticipated to Reach 5.8% by 2034
