Russia Introduces Digital Currency Payment System

Russia is introducing a new “unrestricted” payment system where it plans to use digital currencies in cross-border payments, Russian Finance Minister Anton Siluanov has said. He explained that no third country would be able to intervene and freeze settlement payments between two other countries.

Fully unrestricted use of digital currencies

The minister announced that this digital payment system would be completely unrestricted, Russian news medium Tass reported, cited by Bitcoin.com. He told Tass:

We are launching an alternative system of payments based on modern technologies. Digital currencies could be used in cross-border payments. This is just at the earliest phase of discussions, but the future lies with the use of the digital ruble, the digital yuan, and other similar currencies.

Russia fighting to reduce reliance on USD

After the US and the EU imposed hefty economic sanctions on Russia following the latter’s invasion of Ukraine, Russia has doubled down on efforts to reduce its reliance on the US dollar. After the sanctions, the US and its allies seized more than $300 billion in Russian central bank foreign currency.

Russia has been working on a national digital currency to reduce USD reliance since at least 2014. In 2021, the US Congressional Research Service published a report that Russia had intensified these efforts 7 years ago. They pointed out that introducing a digital ruble would reduce local reliance on the dollar further.

Ruble and yuan have replaced the dollar in China-Russia settlements

The finance minister also stated that his country’s national currency and the Chinese yuan were replacing the USD in mutual settlements between Russia and China. China has already introduced a digital yuan.

The minister claimed they were interested in “the ruble or yuan replacing the dollar.” He added that more than 70% of trade between China and Russia was already in rubles and yuan.