Russia is using cryptocurrencies in its oil trade with China and India to circumvent Western sanctions, according to four sources with direct knowledge of the matter.
While the country has publicly supported the use of digital assets and passed a law last summer to allow crypto payments in international trade, its use in the oil sector has not been previously reported.
Some Russian oil companies are utilizing Bitcoin (BTC), Ethereum (ETH), and stablecoins such as Tether (USDT) to facilitate the conversion of Chinese yuan and Indian rupees to Russian roubles, the sources revealed.
Although this practice remains a small fraction of Russia’s oil trade, it is expanding. According to the International Energy Agency, Russia’s oil trade was valued at $192 billion last year.
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Growing Crypto Adoption in Global Oil Trade
The adoption of cryptocurrencies allowed sanctioned nations Iran and Venezuela to uphold their economic activities and decrease their dependence on dollar usage for worldwide oil exports.
The Russian authorities adopted this initiative after Venezuela started to depend on digital assets for the export of crude oil and petroleum products because of renewed U.S. economic restrictions.
A research expert who assesses sanctioned transactions involving cryptocurrencies reported that Russia maintains various digital payment infrastructure that includes USDT as one of these systems.
All sources maintaining confidentiality about this matter refused to provide their direct names. Historically Russia became one of numerous sanctioned states that chose cryptocurrencies as their solution for developing separate financial mechanisms.
Digital assets have become a decentralized option for international transfers so their use in global commerce shows strong signs of expansion. The growing acceptance of crypto payments in oil commerce stands to remodel existing financial systems and fuel changes in both financial markets and energy industries.
Western governments focused on sanction evasion through blockchain-based transactions are likely to strengthen their regulatory oversight. Digital currencies are gaining significance in worldwide commercial activities because of continuous changes within economic and geopolitical environments.
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