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Author: Mohamed Allam, Messari research analyst; compiled by: 0xjs@Bitchain Vision
A few weeks ago, we introduced the concept of “BRICS” as a rising new financial world order.
Russia is one of the key players in this ever-evolving pattern, and the country is showing growing enthusiasm for integrating cryptocurrency and blockchain technology into its financial system.
Recent updates in Russia
In the past two weeks, three major events have occurred within Russia and the BRICS countries:
1. Russia legalizes Bitcoin and cryptocurrencies
Russia has taken bold steps to formally legalize the use of Bitcoin and other cryptocurrencies.This marks a major shift in the country’s financial strategy and reflects its growing interest in decentralized digital currencies.
2. Russia legalizes Bitcoin and cryptocurrency mining
Russia has also given the green light for Bitcoin and cryptocurrency mining businesses, further integrating into the global cryptocurrency field.Russia’s electricity costs are highly competitive (about $0.06 per kilowatt-hour, compared to $0.18 per kilowatt-hour in the United States), which could make it a major player in Bitcoin mining, especially if it comes with mining equipment.China cooperation.
3. BRICS Bridge: A new payment system
The BRICS countries are seeking to establish a new cross-border transaction payment system that will exclude the US dollar from the mechanism.The payment system will use local currencies for trade settlement, aiming to end dependence on the US dollar.This new payment mechanism, called “BRICS Bridge”, is designed to replace the SWIFT system in the United States and reduce ties to the US dollar.
The transformation of Russian financial methods
It is interesting to see how international sanctions force countries like Russia to reconsider their global trade and financial approaches.
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As the BRICS countries continue to distance themselves from NATO and the West, they are increasingly seeking innovative ways to sustain and develop their economies.
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A few years ago, Russia’s adoption of cryptocurrencies seemed unlikely, but it is now a strategic move in this broader context.
An important part of this strategy is the development of the BRICS digital payment platform “BRICS Bridge”.
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The independent financial system aims to strengthen the economic independence of BRICS countries relative to the Western system and has the potential to integrate cryptocurrencies and central bank digital currencies (CBDCs).
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Valentina Matviyanko, chairman of the Russian Federation Commission, recently confirmed that this independent financial payment platform is progressing steadily.
Russia’s ever-changing trade trend further highlights the need for this strategy.
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In 2023, Russia’s total exports fell 28.3% to US$425.1 billion, of which supply to Europe plummeted 68% to US$84.9 billion.
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Meanwhile, exports to Asia grew 5.6% to $306.6 billion, bringing Asia’s share of Russia’s exports to 72% from 49% in 2022.
By adopting blockchain, cryptocurrencies and CBDC, Russia can promote smoother and safer trade within the BRICS countries, in line with its strategic focus shift to Asia.
Source: “The Rise of the BRICS Countries”
These efforts are a response to sanctions and a deliberate reshaping of the global financial landscape, posing a new world order that challenges established norms.
These developments within the BRICS countries cannot be ignored.
They should be part of the global economic outlook, as they are significantly changing the way international finance works and driving the de-dollarization process.
