Russia Unveils Blockchain-Based Payment System for BRICS Alliance

.. By Nathan Daniels

March 12, 2024

2 min read

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Transforming Trade Settlements

Russia, a prominent member of the BRICS alliance, has announced the development of a groundbreaking blockchain-based payment system aimed at revolutionizing trade settlements among member nations. The initiative marks a significant step towards fostering financial independence and enhancing economic cooperation within the alliance.

Kremlin’s Announcement

In a recent interview with TASS, Kremlin aide Yury Ushakov unveiled plans for the creation of an independent payment system for BRICS nations. Emphasizing the importance of this initiative, Ushakov highlighted its potential to provide a convenient, politically neutral, and economically efficient mechanism for conducting transactions among member nations.

Objectives and Strategy

The development of the blockchain-based payment system aligns with the objectives outlined in the 2023 Johannesburg Declaration, which emphasizes the need to increase settlements in national currencies and diversify correspondent banking networks. However, Ushakov did not specify a timeline for the launch of the new payment system.

BRICS and De-Dollarization Efforts

The BRICS alliance has been actively pursuing de-dollarization initiatives to reduce reliance on the U.S. dollar in international settlements. Beyond the payment system, efforts are underway to develop the Contingent Reserve Arrangement using alternative currencies, a move aimed at bolstering financial stability and autonomy.

Global Financial Trends

The decision to embrace blockchain technology for payment settlements reflects broader global financial trends. Klaas Knot, Chair of the Financial Stability Board, recently highlighted the importance of crypto assets, tokenization, and artificial intelligence in maintaining global financial stability, underscoring the relevance of innovative solutions in today’s financial landscape.

Collaborative Efforts and Multisided Payment Platform

Collaborative efforts between the Russian Finance Ministry, the Bank of Russia, and other BRICS partners are driving the development of the “BRICS Bridge” multisided payment platform. This platform, aimed at enhancing the effectiveness and accessibility of the global monetary system, underscores the commitment of BRICS nations to fostering economic cooperation and resilience.

Advancing Financial Independence

The unveiling of the blockchain-based payment system signifies a significant stride towards advancing financial independence and strengthening economic ties within the BRICS alliance. As the world embraces digital innovation, BRICS nations are poised to play a pivotal role in shaping the future of global finance through collaborative initiatives and forward-thinking strategies.