Russian commodities firms, especially in the metals and timber industry, are now opting to transact with their Chinese counterparts through stablecoins, with Tether (USDT) as their preferred currency. This shift is mainly attributed to current sanctions against Russia due to the ongoing Ukraine-Russia war, thereby inferred difficulties in monopolies surrounding payments and equipment procurement.
According to Ivan Kozlov, co-founder of Resolve Labs, stablecoins are quicker and cheaper for these operations because they take approximately 5-15 seconds to process such transactions.
According to the report, Stablecoins also eliminate the practice of having overseas bank accounts frozen, a problem often affecting Russian companies. The shift in Russia to develop its own digital currencies is an indication of the changing perception of the government toward cryptocurrencies. Despite considering all cryptocurrencies illegal at some point, the Russian central bank is now willing to test crypto payments for global operations.
The trend does not end with Russia. Venezuela started to use Tether for oil purchases, which proves that stablecoins are gradually entering the markets with a shortage of dollar liquidity and strict capital controls. Russian lawmakers are discussing possible regulation of stablecoins for international settlements, noting the benefits of cryptocurrencies as they eliminate certain financial restrictions.
This development shows that cryptocurrencies are viable, and their scope is only increasing with time.
Also Read: Nigerian Senate Calls for Regulation of Crypto Trading
