At first glance, Bitcoin appears to be a good fit for Russia’s crypto international transactions, but this idea is very doubtful for some reasons.
Although Russia is advocating for the use of cryptocurrency for trans-frontier transactions, it is yet unknown precisely which digital asset the government is planning to use for these exchanges.
As per local attorneys and Fintech officials, it is doubtful that Russian officials will authorize the usage of cryptocurrencies like BTC (Bitcoin) for international payments.
The Bank Of Russia Need To Monitor International Trade
According to Elena Klyuchareva, a high-ranking partner at the regional legal firm KKMP, it is very doubtful that Russia would permit the use of BTC or any other cryptocurrencies for transnational transactions since these resources are difficult to monitor.
Klyuchareva underlined that while the media simply claim that the Bank of Russia and the Ministry of Finance have decided on a unified solution to the situation, the proposed modifications to the regulations on cross-boundary crypto payments are still unavailable.
According to the lawyer, Russia would probably employ native cryptocurrencies for cross-border transactions so that Russian officials can effectively supervise and control such activities. She also asserted that the only institutions that can meet the standards for handling trans-border trading are the prominent entities, such as banks.
The Shortcomings Of BTC
Bitcoin, the most prominent decentralized coin in the market, could seem more appropriate in this situation. Still, Bitcoin is also linked to a number of problems, including high volatility, inadequate scalability, and susceptibility to international restrictions.
Davydov observed that entire arrays of addresses could come within the limits when dealing with which the currencies would be regarded ‘dirty,’ and counterparties may opt not to perform transactions with such addresses or currencies.
According to Sergey Mendeleev, CEO and co-founder of InDeFi Smart Bank, decentralized cryptos such as BTC could only be a smart decision for Russia’s crypto cross-border transactions if they were less unstable.
Mendeleev stated that it is difficult to see a circumstance in which global firms would make payment in a currency tied to the Russian rubles.
The CEO said he hoped Russian officials might have the guts to let international trade, including at least USD stablecoins on large blockchains.
Mendeleev emphasized that the launch of a decentralized cryptocurrency ruble program by InDeFi Smart Bank in September 2022 was explicitly proposed to streamline this concept.