Kathmandu. Russia has not seen any impact from US sanctions. Russia is using cryptocurrency in its oil trade, ignoring US and Western sanctions.
According to Reuters, Russia has publicly promoted the use of crypto. Last summer, Russia also passed a law allowing digital currency payments in international trade. However, there has never been any news of its use in the oil business before.
Some Russian oil companies are using stablecoins such as Bitcoin, Ether and Tether to convert Chinese yuan and Indian rupees into Russian rubles. The use of crypto in Russia’s overall oil trade is growing.
Russia’s oil trade was worth $192 billion last year, according to the International Energy Agency (IEA).
Cryptocurrencies are already helping countries like Iran and Venezuela run their economies under US sanctions. Cryptocurrencies are also proving helpful in avoiding the use of the dollar. The dollar is preferred for transactions in the global oil market.
Venezuela has stepped up its use of digital currencies to export crude oil and fuel following the reimposition of US sanctions. Russia is also moving in the same direction.
US President Donald Trump is trying to improve relations with Russia to end the ongoing war in Ukraine. However, it is not yet clear whether sanctions will be lifted.
Reuters reported that the White House was drafting options for sanctions relief. However, on March 7, Trump said that he was seriously considering imposing more sanctions on Russia.
Cryptocurrency is likely to continue to be used in Russian oil trade even if sanctions are lifted and the dollar is used again. Experts say it is a convenient tool that helps get the job done faster.
How is crypto traded?
A Chinese buyer of Russian oil pays a trading company acting as an intermediary in yuan. The payment is made to an offshore account. The intermediary converts it into crypto and transfers it to another account. From there, it is sent to a third account in Russia and converted into rubles. A Russian oil trader’s crypto transactions for sales in China are worth hundreds of millions of dollars per month. –Agency
