Russia Considers Launching Gold-Backed Tokens for Cross-Border Payments

Analysis

July 26, 2024 7:53 PM

In Brief:
Russia is exploring gold-backed tokenized assets managed by its central bank to address cross-border payment challenges amid ongoing sanctions.
Lawmakers are testing these tokens with plans for broader implementation by year-end, although the initiative is not yet state-level.

Russia's Bold Move Amid Sanctions

As sanctions continue to impact Russia, the country is exploring the creation of gold-backed tokenized assets for cross-border trades.

Russian lawmakers are considering these assets, which would be directly managed by the central bank, as a solution for persistent international payment challenges.

According to local reports, discussions involving high-profile officials and major banking sources suggest that Russia is evaluating this approach to offer enterprises a stable mechanism for international transactions.

However, this initiative isn’t yet in development at the state level.

Testing and Regulatory Framework

Anatoly Aksakov, head of the State Duma Banking Committee, revealed that market participants are currently testing the gold-backed tokens, with plans for full-scale availability by year-end.

While the regulatory framework for these tokens is already in place, Aksakov did not disclose specific details on operators or transaction processes, citing concerns over sanctions.

In early July, crypto.news reported that Russia’s central bank, the Bank of Russia, is considering the legalization of stablecoins for cross-border transactions to maintain trading activity with China.

Central bank deputy governor Alexei Guznov said the proposal is under discussion and has been formulated, adding that the eventual goal is to regulate the entire process chain that would enable individuals to “transfer these assets into Russia, accumulate them, and use them for international payments.”

Potential Permanent Framework

Guznov also indicated that the initiative could potentially transition from a temporary experiment to a permanent regulatory framework, although specifics regarding the timeline for approval weren’t disclosed.

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