In what comes as a surprise, Russia is all set to give green signal to a law that will allow the use of crypto for international payments. According to CNBC a new law allowing the use of cryptocurrencies for foreign payments was approved by Russian lawmakers on Tuesday, amid continued financial pressure from Western sanctions on the nation.
The proposed law, which would permit companies to utilize cryptocurrencies for cross-border trade, received preliminary approval from the State Duma, the lower chamber of the Russian parliament.
Russia’s previous crypto laws
Russia had previously considered banning cryptocurrencies and crypto mining. In 2023, Russia’s finance ministry proposed that the organization of cryptocurrency circulation be prohibited. This law had the exception of stablecoins and the sales of coins by miners. Nevertheless, the investigation committee and the FSB, Russia’s secret agency, vetoed the move.
Before this, the country had implemented a law regulating digital financial asset (DFA) transactions, issued by Vladimir Putin in July 2020. The regulation permitted cryptocurrency transactions but forbade using them as a means of payment for goods and services.
However, despite all this, crypto transactions picked a steady pace in the country, as reported by Bankless Times. Research shows that most Russian states have a good number of crypto transactions. Within the nation, compared to Saint Petersburg, Moscow had a comparatively higher number of businesses in 2021 that accepted cryptocurrency payments through in-store ATMs or other means.
With a population around one-third that of the capital, Russia’s second-biggest city has 20% more businesses accepting cryptocurrencies than the capital.
Russia crypto acceptance comes amid heavy sanctions
The decision to permit cross-border crypto transactions coincides with escalating hostilities between Russia and the United States and its allies, which have resulted in several sanctions against Russian individuals and organizations for their invasion of Ukraine.
Following its invasion of Ukraine in February 2022, the United States, the European Union, and the United Kingdom were among the nations that placed sanctions on Russia. They have not stopped applying more and more pressure on the nation, focusing on several oligarchs, the financial industry in Russia, and President Vladimir Putin.
According to the same CNBC report, Russia is also considering introducing a digital currency.
