Just-In: Russia Plans To Launch 2 Crypto Exchanges & BRICS Stablecoin August 23, 2024
📝💲💲📝 Russia is now planning to launch two major crypto exchanges, one in Moscow and the other in St. Petersburg. This move underscores the need to boost foreign economic activity (FEA). Moreover, it eyes building a Chinese yuan-pegged BRICS stablecoin, further pushing the dedollarization efforts.💲🎉⌨️
The crypto exchange initiative is designed to provide a new platform for digital transactions. However, experts have expressed concerns over the potential limitations and risks associated with the project, particularly in light of international sanctions.
Russia’s Plans On Developing The Crypto Sector
One of the crypto exchanges will likely leverage the infrastructure of the St. Petersburg Currency Exchange (SPCE) to facilitate foreign economic activity, according to a report by Kommersant. Whilst, the other platform is expected to be based in Moscow. However, it remains unclear whether it will be developed on the foundation of the existing Moscow Exchange or as a separate entity within an experimental legal framework.
The primary focus of these exchanges will be the creation and use of stablecoins. For context, stablecoins are a type of crypto that is typically pegged to a reserve of assets, such as a national currency or a basket of currencies. In this case, the Russian government is reportedly considering the development of stablecoins linked to the Chinese Renminbi (RMB) Yuan and the BRICS currency basket.
Hence, this move is aimed at boosting economic cooperation among the BRICS nations (Brazil, Russia, India, China, and South Africa). Currently, BRICS is eyeing dedollarization via crypto and blockchain. However, the development and deployment of a BRICS stablecoin via newly-launched crypto exchanges present a number of challenges.
Oleg Ogienko, CEO of BitRiver, pointed out the technological difficulties in integrating stablecoins into Russia’s blockchain infrastructure. He noted that “stablecoins, due to their legal nature, are more like cryptocurrency.” This could complicate their convertibility, liquidity, and security. Moreover, the complexity of these issues could hinder the seamless adoption of stablecoins in Russia.
Current Regulatory Framework & Challenges For Crypto Exchanges
In terms of regulatory frameworks, Russia currently operates under Federal Law No. 259 “On Digital Financial Assets.” This regulation provides the legal basis for the issuance and circulation of digital assets. However, this legislation does not specifically address the creation or regulation of cryptocurrency exchanges.
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