Will Russia use China’s e-CNY to avoid sanctions?
Now those who are watching the crypto market and the Russia-Ukraine war might be wondering if Russia can benefit from China’s CBDC?
The Association of International Financial and Interbank Telecommunication (SWIFT) is a cross-border payment system that helps users around the world to make purchases, transfer money, pay fees … Now organizations with large financial institutions in Russia are being removed from the system and Da As the currency depreciates, some are speculating that Russia may be looking to China to find an alternative.
Russia uses China’s CBDC?
The digital yuan made its debut at the Beijing 2022 Olympic Games in early February. In addition, Chinese officials say that this type of CBDC has generated $13.68 billion in trading volume.
According to the report, there are more than 260 million digital yuan users and the government is still trying to persuade, or possibly pressure, foreign companies in China to accept CBDC payments.
Analysts are currently watching whether Russia will decide to introduce a digital yuan as an alternative to the SWIFT system.
There are arguments for and against this opinion. China, for example, is not only heavily involved in developing its own CBDC, but also participates in a multi-CBDC platform with other countries’ central banks. From this perspective, it is possible to allow Russian users to participate in promoting the cross-border adoption of the digital yuan while helping Russia reduce its dependence on the SWIFT system.
On the other hand, China can take some appropriate measures to reach Russia without imposing sanctions on its own companies. Also, China’s digital yuan is still in its infancy and may not be ready for cross-border use cases, especially in war.
However, crypto investors are well aware of this connection, as Santiment has shown notice that “China” is still in the top 10 trending keywords alongside the war between Russia and Ukraine.
???????????????? Consciousness seems to be fully utilized now #crypto circles. Among our top 10 trending algorithms, all 10 keywords are related to the #War. With this development #cryptocurrencies fluctuates with each message in peak correlation. ????https://t.co/6fUEwTxtZn pic.twitter.com/SgnqRf92qq
— Santiment (@santimentfeed) February 25, 2022
Russia is piloting CBDC
Earlier this month, Russia began piloting its CBDC project for a digital ruble that may be completely different from the one mentioned in today’s news.
The Central Bank of Russia has expressed its hostility towards private cryptocurrencies and has advocated banning them outright. However, President Putin and the Treasury have been more open to bitcoin due to the benefits it can bring to the country.
Some people suggest that Russia can use cryptocurrencies to evade sanctions and help itself in the war like Ukraine did. However, there are no reports on this yet.
This month, the Russian government reached an agreement to regulate cryptocurrencies as “currency” instead of banning them.
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