Russia is gearing up to launch two cryptocurrency exchanges in Moscow and St. Petersburg. This step is aimed at facilitating global trade and potentially sidestepping Western sanctions.

More: UAE Asks France for 'Urgent' Consular Services to Durov

The news, first reported by local media outlet Kommersant on August 23, 2024, shows that Russia may just change their stance on crypto and go full El-Salvador route. 

These exchanges are set to provide secure platforms for high-profile assets and will operate under an experimental legal framework to navigate the complex regulatory landscape. Initial trials are slated to begin trials on September 1, 2024.

Let's break down the key points:

  • Two major crypto exchanges to be established in Moscow and St. Petersburg
  • Focus on facilitating international trade using digital assets
  • Initial access limited to major firms, including exporters and importers
  • Plans to issue stablecoins pegged to the Chinese yuan and BRICS currency basket
  • Part of a broader strategy to mitigate the impact of Western economic sanctions

It’s worth noting that this move isn’t coming out of thin air. Russia has been laying the groundwork for some time now. In fact, the Russian State Duma recently passed legislation to legalize Bitcoin mining and is considering giving the green light to stablecoins for international payments.

But why the sudden change of heart? Well, it's no secret that Russia's been taking much heat from Western sanctions, particularly since its annexation of Crimea in 2014 and the invasion of Ukraine in 2022. 

These economic restrictions have left the country scrambling for alternative methods to conduct international transactions. And what better way to bypass the traditional financial system than with decentralized digital currencies?

Now, before you start picturing Vladimir Putin furiously trading Dogecoin on his smartphone, it's important to note that these exchanges won't be a free-for-all. Mikhail Uspensky, a member of the State Duma's legislative committee on crypto regulation, made it clear that access will initially be limited to a select group of users.

Now, that’s not all; Russia is also considering issuing stablecoins pegged to the Chinese yuan and a basket of BRICS currencies. For those who've been living under a rock, BRICS is an organization made up of emerging economies, including Brazil, Russia, India, China, South Africa, and some new members like Iran, Egypt, Ethiopia, and the United Arab Emirates.

This stablecoin strategy is part of a grand plan to reduce reliance on the almighty US dollar and strengthen trade ties among BRICS nations.

Related: China Updates AML Laws, Classifies Crypto as Money Laundering

But before we get carried away with visions of a crypto-powered utopia, it's worth remembering that this is still very much an experiment. The exchanges will operate under what's being called an "experimental legal regime."

As you well know, Russia isn’t the first to go pro-crypto. El Salvador made headlines when it became the first country to adopt Bitcoin as legal tender. (Although, given the recent market meltdowns, one can't help but wonder if they're regretting that decision every time Bitcoin takes a nosedive.) 

Meanwhile, countries like Malta and Singapore have rolled out the red carpet for crypto businesses, offering supportive regulations and tax incentives.

UAE Residents Are Finally Able To Trade Crypto Directly With Bank Accounts | HODL FM
UAE residents can now buy, sell, and convert crypto directly with…
hodl-post-imageHODL FM: The Wildest Ride in the Crypto MarketAbimbola Adu
hodl-post-image

Disclaimer: All materials on this site are for informational purposes only. None of the material should be interpreted as investment advice. Please note that despite the nature of much of the material created and hosted on this website, HODL FM is not a financial reference resource and the opinions of authors and other contributors are their own and should not be taken as financial advice. If you require advice of this sort, HODL FM strongly recommends contacting a qualified industry professional.