• 18 June, 2024

Russia & Iran to Launch a Gold-Peg Stablecoin

The Central Bank of Iran (CBI) or Bank Markazi is reportedly developing a gold-pegged stablecoin with the Russian Federation. As per Alexander Brazhnikov, executive director, the Russian Association of Crypto Industry and Blockchain (RACIB), the stablecoin will be used to pay for foreign trade transactions.

The stablecoin in question would expedite the special economic zone trade in Astrakhan—where Russia receives cargo from Iran. The stablecoin launch negotiations are ongoing, as confirmed by the State Duma deputy, Anton Tkachev (Member, the Committee on Information Policy, Information Technology and Communications).

Per Tkachev, the stablecoin topic will be escalated at the state-level discussions once cryptocurrency regulations in Russia are legislated. The Central Bank of Russia is not in support of cryptocurrencies as a retail payment means in Russia. But, it is still pro-cryptocurrency for import and export transactions.

Following Russia’s Ukraine invasion, European Union authorities reportedly prohibited European companies from offering crypto services to Russian residents. Russia’s ex-banking millionaire, Alexander Lebedev’s startup, InDefi, also wanted to launch a (MakerDAO) DAI-model stablecoin on the Ethereum blockchain.

A former National Standard Bank (Russia) owner, Lebedev’s InDefi had in September 2022 announced plans to launch a stablecoin pegged to Ruble. InDefi co-founder, Sergey Mendeleev, stated at the Blockchain Life conference in Moscow that their proposed decentralized stablecoin is not related to the Bank of Russia’s digital ruble.

Mendeleev said the stablecoin

Will not only make it easier for Russian citizens to access international cryptocurrency exchanges, but also, after changes in legislation, provide transactions with foreign counterparties via crypto.

In July 2022, Russian President Vladimir Putin had banned digital payments via a law. But then the Bank of Russia and Finance Ministry stated to the Tass agency,

It is impossible to do without cross-border settlements in cryptocurrency.

After officially recognizing crypto mining in 2019, Ali Plucinski, cybersecurity analyst, RANE, says,

The Iranian government approved the use of crypto funds to pay for imports in August 2022, thereby enabling the regime to circumvent extensive US sanctions imposed on Iran’s finance and banking sector.

A blockchain analytics firm Elliptic’s 2021 report states around 4.5% of global Bitcoin mining happens in Iran. The same report values Iran’s annual Bitcoin mining revenue close to $1 billion.

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