Setting the Stage for Cryptocurrency Use
In an interesting twist amidst international sanctions, an executive from Russia’s Chamber of Commerce and Industry has proposed that the government looks towards cryptocurrencies and central bank digital currencies (CBDCs) as viable options for cross-border settlements. Sergei Katyrin, President of the Chamber, has put forward a charter of recommendations aimed at enhancing financial cooperation with African nations.
The Call to Action
In a letter directed to Russian Prime Minister Mikhail Mishustin, Katyrin emphasized the necessity of developing mutual settlements and payments through the use of CBDCs and cryptocurrencies, stating
“It seems useful to instruct the Ministry of Finance of the Russian Federation, together with the Central Bank, to ensure providing intergovernmental agreements with African states on the use of national currencies and cryptocurrencies in mutual settlements and payments.”
Export-Import Initiatives
Katyrin’s vision doesn’t stop at currency; he also underscored the need to establish a special export-import bank along with a trust fund. This setup would be crucial to support the export ventures of small and medium-sized businesses in Africa. It appears that the Russian moves are part of a larger strategy to extend its economic ties with the rapidly evolving markets in Africa.
African Engagement with Blockchain
Meanwhile, several African nations are warming up to the idea of integrating blockchain technologies related to Russia. A recent announcement from Cameroon, the Democratic Republic of the Congo (DRC), and the Republic of the Congo showcased their intent to adopt the TON blockchain, launched by Telegram. Interestingly, the DRC is also eyeing the launch of a national stablecoin based on the same technology.
The Bigger Picture: Cryptocurrency Growth
As these nations embark on the transition, they aim to make cryptocurrency a key aspect of their economic frameworks. Notably, during the past year, cryptocurrency usage in Africa escalated, with reports highlighting a staggering 2,500% increase for crypto users in 2021 alone. It seems evident that the African continent is prime for such technological innovations.
Russia’s Own Crypto Endeavor
In the backdrop of these emerging partnerships, Russia is also navigating its own cryptocurrency landscape. Back in early 2021, the use of cryptocurrencies for payment was outright banned, but this hasn’t halted progress. Most recently, the Bank of Russia has trialed the digital ruble by executing CBDC transfers among citizens, indicating a possible shift from restrictions to regulation.
