Russia Increasing Use of Cryptocurrencies in Oil Trade

Russia has promoted the use of cryptocurrencies and passed a law last summer legalizing digital currency payments in international trade.

Some Russian oil companies are using Bitcoin, Ether, and Tether stablecoins to convert Chinese yuan and Indian rupees into Russian rubles. According to the International Energy Agency, Russia’s oil trade was valued at $192 billion last year.

Cryptocurrencies have helped countries like Iran and Venezuela, both subject to US sanctions, continue their economies without relying on the dollar. Russia’s move comes after Washington reimposed sanctions and Venezuela accelerated digital currency usage.

Russia has set up various systems, with Tether (USDT) being one of them, according to a fifth source, a researcher tracking the use of cryptocurrencies to evade sanctions.

Trump’s Sanctions Decision Uncertain, Crypto Continues in Oil Trade

US President Donald Trump seeks to improve relations with Russia to end the war in Ukraine, but it remains unclear whether sanctions will be lifted. Cryptocurrencies are expected to continue being used in Russia’s oil trade even if sanctions are lifted.

Cryptos are seen as a practical tool that speeds up transactions. Chinese buyers pay yuan for Russian oil, which is then converted into cryptocurrency and transferred to Russia. A Russian oil trader’s monthly sales to China involve cryptocurrency transactions worth tens of millions of dollars.

Russia’s Increasing Role of Cryptocurrencies and Alternative Payment Methods in Oil Trade

Analysts note that while traditional currencies still make up the majority of Russia’s oil transactions, alternative payment methods, like the UAE dirham, are also being used.

A Russian cryptocurrency exchange, Garantex, which was sanctioned by US in 2022 and by the European Union last month, suspended its services last week. Tether blocked the exchange’s digital wallets.

One source mentioned that cryptocurrencies are being used to overcome payment challenges.

In the comment section, you can freely share your comments about the topic. Additionally, don’t forget to follow us on Telegram, YouTube, and Twitter for the latest news.

The post Russia Turns to Cryptocurrencies to Avoid Western Sanctions appeared first on Coin Engineer.