Russia’s Rosbank, one of the most important banks in the country, has announced the launch of a crypto payments solution to facilitate cross-border settlements.
Rosbank has been conducting a pilot for transactions using cryptocurrencies despite being sanctioned by the United States Treasury Department.
According to a representative from Rosbank, the financial institution is now conducting pilot transactions with private and corporate clients. According to Rosbank, the service is the first of its kind in the sector and is compliant with all Russian legislation and the requirements of the Central Bank of Russia (CBR). While the Central Bank of Russia has steadfastly opposed the free circulation of cryptocurrencies within the country, it is far more welcoming to allowing their use in cross-border transactions. However, the central bank has stated that they must be carried out outside of the Russian financial infrastructure.
The move comes after Rosbank’s owner, Vladimir Olegovich Potanin, stated that tokenized assets and a central bank digital currency (CBDC) could play a critical role in driving the country’s digital economy.
Russia’s Stance On CryptoRussia’s law on digital financial assets prohibits residents in Russia from accepting digital currencies as payments for goods and services. However, lawmakers in the State Duma are weighing their options and considering specific amendments. These amendments would allow the expansion of the legal framework and include cryptocurrencies, legalizing crypto transactions under an “experimental legal regime.”
However, with Russia under severe pressure thanks to unprecedented Western sanctions following the invasion of Ukraine, the government and businesses in the country have been looking at ways to circumvent the sanctions. One of the options includes increasing the use of cryptocurrencies and national currencies. Officials in Moscow have admitted to several companies using crypto to complete cross-border payments despite a lack of regulation. President Vladimir Putin has also suggested that Russia could become a Bitcoin mining hub. The Russian government also curtailed plans to create a state-run cryptocurrency exchange, opting instead for the regulation of private operators.
Partnership With B-CryptoRosbank has entered into a partnership with B-crypto to support the new service. B-crypto specializes in processing cross-border transactions and settlements using digital currencies. Whenever a company initiates a cross-border transaction using cryptocurrency, the payment made in crypto to the foreign counterpart must be reflected in the contract. Furthermore, the invoice issued by the supplier must also indicate a wallet address and the amount of crypto that has been sent. Under the partnership, Rosbank will accept fiat deposits, while B-crypto will be responsible for processing the payment and crypto conversion.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
