Russia may use cryptocurrencies in settlements with African countries: official’s proposal
Sergey Katyrin, president of the Russian Chamber of Commerce and Industry, in a letter to Prime Minister Mikhail Mishustin, submitted a number of proposals to improve cooperation with African countries, among them the idea of using central bank digital currency (CBDC) and cryptocurrencies in mutual settlements. Presumably, this is all part of an attempt to enhance Russia’s ability to evade the sanctions imposed due to the creation of lingering geopolitical problems in Ukraine. We will elaborate on the situation in more detail.
It should be noted that this is not the first time Russia has discussed the prospect of using cryptocurrencies to possibly circumvent sanctions. After all, the coins are decentralised, which means that there is no way to prohibit interaction with them.
However, experts have doubts about this possibility. Firstly, digital assets are closely linked to banks, which cannot circumvent bans. Secondly, the entire cryptocurrency industry may not be big enough for large settlements on a daily basis – it is trivially small for that.
The power of Bitcoin
However, one official does suggest trying the scheme.
How cryptocurrencies are used
Here is Katyrin’s quote from a letter published by the news outlet Cointelegraph.
It seems advisable to instruct the Ministry of Finance together with the Central Bank to ensure that intergovernmental agreements with African states (as agreed) on the use of national currencies and cryptocurrencies in mutual settlements and payments are concluded.
In other words, the author of the idea really considers this option appropriate in the context of global sanctions. Why this concerns only African countries is unknown.
The President of the Chamber of Commerce and Industry of the Russian Federation Sergei Katyrin
The official reckons that now it is very important to work towards setting up a specialised export-import bank and a specialised fund to support the export activities of business entities. At the same time, several African countries are seriously considering cooperation with blockchain projects that have links with Russia.
On Monday, for example, Cameroon, the Democratic Republic of Congo and the Republic of Congo issued a joint statement about national plans to adopt TON, a blockchain developed by the Telegram team. The Democratic Republic of Congo is also considering launching a new national stablcoin based on TON. Although Telegram is not formally involved in blockchain development after abandoning the project in May 2020, in late 2021 co-founder Pavel Durov still expressed public support for TON and its possible integration into the Telegram messenger.
While the Russian Federation is only considering the active use of crypto, Amazon is in no hurry to move in that direction. The day before, the company’s CEO Andy Jassy said that Amazon is unlikely to accept cryptocurrency payments in the near future. Here’s his rejoinder, cited by Decrypt.
We’re probably not close to adding cryptocurrencies as a payment mechanism to our business model, but I believe the digital asset industry will become even bigger over time.
Amazon CEO Andy Jassy
However, Jassy was much more positive about unique tokens, i.e. NFT. He does not rule out a scenario in which Amazon could participate in a popular industry trend – perhaps by issuing its own NFT collection. However, the Amazon CEO did not give any timeline or concrete prospects in this direction.
Although as recently as last year, the commercial giant said it was “exploring” the possibility of integrating cryptocurrency payments for the platform.
We are inspired by the innovation happening in the cryptosphere and are exploring how this could impact Amazon. We believe that the future will be built on new technologies that enable modern, fast and low-cost payments, and hope to bring that future to Amazon customers as soon as possible.
Amazon
Cloud platform subsidiary Amazon Web Services has also advertised for a product manager to work on the Amazon Managed Blockchain project. The vacancy states that preference is given to candidates with experience in decentralised finance.
In addition, the Amazon Advertising FinTech team was looking for a senior software engineer to work on “financial accounting and billing systems” last year. There was no direct mention of cryptocurrencies or blockchain technology in that vacancy, but they were still found in the site URL.
We believe that such an initiative for RF could be successful, but only on a small scale. For example, the total trading volume in the cryptocurrency industry in the last 24 hours is $93 billion, which is clearly not a figure that can replace full-fledged payments. So obviously, sanctions will continue to hurt the economy. And crypto is unlikely to help.
Look for even more interesting things in our millionaires’ cryptochat. There we will talk about other topics related to decentralisation.
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