According to RBC, Russia will accept Bitcoin for its energy exports – at least from Turkey and China. Pavel Zavalny, Chairman of the State Duma Committee on Energy, revealed today that Russia would allow its “allies” or neutral countries to pay for oil in their local currencies or cryptocurrency.
The declaration is made after a series of international restrictions that virtually isolated Russia from the global financial system. This country was sanctioned by the US, Europe and other countries such as South Korea and Japan for its invasion of Ukraine.
The Russian Federation, headed by President Vladimir Putin, has been seeking alternatives to revive their economy when their national currency ruble depreciates.
Bitcoin may be a viable alternative due to its censorship-resistant capabilities. BTC funds are not subject to freezing or seizure (as the International Community did with Russia’s gold reserves) and can be utilised by any entity worldwide.
Zavalny stated that Russia has been proposing to China to transition to national currency settlements for rubles and yuan. With Turkey, it is the lira and rubles. It is usual for the set of currencies to be different, but they will also exchange bitcoins if any are available.
The armed conflict between Russia and Ukraine has been for about a month, and it seems to become an expensive venture for Putin’s soldiers. Russia’s ability to prolong the onslaught has been questioned, but the battle may continue if Putin has found ways to keep the economy afloat.
As RBC noted, Russia’s “unfriendly” nations will be required to pay for oil in gold and rubles.
Rubles and Bitcoin. Image: Shutterstock
Can Bitcoin Assist Russia in Evading Sanctions?
In Russia, cryptocurrency legislation has been ambiguous, with some government officials advocating for a complete prohibition ban on trading and mining activities. Putin and Zavalny, on the other hand, endorse the usage of digital assets, and with the current declaration, the government may step toward more expeditious legalisation of the crypto sector.
Bitcoin critics have said that cryptocurrency might be used to fund Russia in dodging international sanctions and other economic consequences for its military actions.
However, according to CoinCenter’s Neeraj Agrawal, US officials have ruled out this possibility. Agrawal has shown the other side of the coin, where, rather than assisting the attacker, BTC and cryptocurrencies are being utilised in Ukraine to transfer money. Since the conflict, Ukraine has received millions of crypto funds to support its war efforts, and recently, Ukraine’s President Volodymyr Zelenskyy signed a bill on virtual assets.
“She originally got into cryptocurrency when her Ukrainian bank wouldn’t let her move out an appreciable amount of money, and the fees that PayPal charged were higher than she wanted to pay. “With crypto, it was much easier,” https://t.co/DoxdtkudlD
— Neeraj K. Agrawal (@NeerajKA) March 23, 2022
Bitcoin seems to be responding well to the announcement. The crypto reclaimed the mid-levels around its current levels and may see additional gains in the immediate term if bulls maintain momentum.