- On July 30, Russian lawmakers approved crypto bill
- It enables Russian companies to trade crypto internationally
- Also, it potentially enables the avoid Western sanctions
- The law is expected to come into force in September 2024
Russian lawmakers approved the crypto bill yesterday, July 30, and the law will take effect in September.
What Exactly Does This Crypto Law Provide?
We have already discussed the nomination of this bill in other articles; you can read it here.
This bill has been passed and supported by Russian Central Bank governor Elvira Nabiullina, and in accordance with Russian law, it will take effect in September.
It aims to regulate the mining and international cryptocurrency trade for private and public organizations.
Its primary purpose is to allow Russia to experience less influence from the world’s reserve currency in its international transactions.
It may also be one of the key financial instruments of BRICS, an alliance of countries with similar goals regarding the dollar.
What Is the Role of Western Sanctions in Russia’s Crypto Adoption?
Many Western analysts, even at the time of the bill proposal, agree that such rapid adoption indicates a desire to mitigate the effect of sanctions, which have impacted the Russian economy.
The central bank reported that payment delays have become a serious problem for the Russian economy, leading to an 8% drop in Russian imports in the second quarter of 2024.
Despite Russia’s efforts to switch to the currencies of its trading partners and develop an alternative payment system within the BRICS group, many transactions are still conducted in dollars and euros through the international SWIFT system.
An alternative decentralized payment system could help the Russian economy interact more effectively in trade with countries such as China, India, and the United Arab Emirates.
Update from August 1: El Salvador has already proposed using Bitcoin as the main currency for trading with Russia.Â
Conclusions
The need to adopt cryptocurrencies due to their advantages over a centralized financial system seems to be becoming increasingly evident, and the swiftness of the decisions being made is extremely high.
However, we are now actively hearing similar things in the United States, which also greatly accelerates the adaptation of cryptocurrencies for public and private interests.
Here, it is more like a way to escape sanctions only, as the law does not legalize Bitcoin domestic use.
