Russian Crypto Payments Can Be Acceptable in Foreign Trade

Russia’s financial watchdog Rosfinmonitoring is ready to accept the use of cryptocurrencies in international settlements, the head of the agency, Yuri Chikhanchin, has said, adding to growing support for the legalization of international crypto payments in Russia amid financial restrictions imposed over the Ukraine conflict.

Rosfinmonitoring the Federal Financial Monitoring Service of the Russian Federation, fully accepts that cryptocurrencies can be employed for settlements with foreign partners, Yury Chikhanchin, director of the regulatory body has stated.

Speaking in the Federation Council, the upper house of Russian parliament, Chikhanchin emphasized that payments with digital assets inside Russia are prohibited by law. The country’s current legislation bans “money surrogates.” However, under certain conditions, such payments may well be used in international trade, Chikhanchin said. The high-ranking official believes this can help businesses oriented towards exporting Russian products, noting that “If the supply chain is controlled, then this is quite acceptable.”

Chikhanchin further emphasized that in order to take advantage of cryptocurrency payments, Russian companies need to know to whom exactly they are exchanging the digital currencies. He stated that his department has developed and already launched a special information system for tracking crypto transactions. It allows financial authorities to identify both the sender and the recipient of funds and has been used in some trials.

The debate over the future of cryptocurrencies in Russia is still ongoing. A new bill “On Digital Currency” is expected to introduce more comprehensive rules for crypto transactions after the law “On Digital Financial Assets” regulated only some aspects of the crypto market.

The idea to use cryptocurrencies in international settlements has been gaining support amid mounting Western sanctions over Russia’s intervention in Ukraine. At the same time, most government institutions in Moscow agree that the ruble should remain the only legal tender in the country.

While the Bank of Russia, a strong opponent of the free circulation of cryptocurrencies, recently signaled it could back the legalization of crypto payments that don’t penetrate Russia’s financial system, the lower house of Russian parliament recently adopted a law banning domestic payments with digital financial assets. However, it is clear that change is coming and that the Ukraine conflict is speeding up Russia’s efforts to evolve to a digitally based economy.