Russian paper hints at BRICS cross-border payment system
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Homepage > News > Business > Russian paper hints at BRICS cross-border payment system With the upcoming annual BRICS Summit in Kazan next week, speculation about a potential gold-backed digital currency and alternative payment system has been heating up. While BRICS members have discussed such a currency on and off since the 2010s, the Russian government started dropping stronger hints about it in 2022 after a tidal wave of U.S. sanctions against it. By 2023, these were no longer mere hints—Russian President Vladimir Putin was openly promoting the idea of such a currency and de-dollarization generally, with the proposed BRICS Unit becoming a major talking point at last year’s South Africa Summit. As the 2024 Kazan Summit approaches, the Russian Ministry of Finance, Bank of Russia, and management consulting firm Yakov and Partners have released a paper detailing what such a payment system might look like. DLT is the preferred approach The paper outlines multiple approaches as to how a BRICS cross-border payment system might look. Four proposals are outlined: An international network of commercial banks that can settle cross-border payments in local currencies. Direct links between BRICS countries’ central banks, again using national currencies. Centers for directly trading commodities like gold, oil and gas, and grain. A digital ledger with settlement by digital-currency-backed tokens and CBDCs. After considering all four, the paper makes clear that the DLT option is the preferred option. Perceived benefits include the removal of intermediaries and the compliance checks they necessitate, as well as the speed and cost savings such an efficient system would bring. While the paper does not directly state that such a system is being created, when taken together with Alexander Bubakov’s recent comments to Russian media, it provides plenty of food for thought as the Kazan Summit approaches. Is a BRICS…
Filed under: News - @ October 18, 2024 1:28 pm