Crypto: Russia & Iran working on Gold-backed Stablecoin together?

Paigambar Mohan Raj
Iran Russia Putin BRICS
Source: Financial Tribune

The Central Bank of Iran is considering developing a stablecoin with the Russian Federation as a means of payment in international commercial transactions. The development was revealed by Alexander Brazhnikov, executive director of the Russian Association of Crypto Industry and Blockchain. Russia and Iran are both on the list of countries sanctioned by western powers.

Brazhnikov suggested that the currency will be pegged to gold. The prospective currency would function in Astrakhan’s special economic zone, where Russia has started to allow Iranian goods.

Duma deputy Anton Tkachev acknowledged the existence of the talks. Moreover, Tkachev is a member of The Committee on Information Policy, Information Technology, and Communications. However, Tkachev said the discussion would enter the state level when the crypto industry is fully regulated. The regulation of cryptocurrencies should see the light of day in 2023.

Russia and Iran join hands in crypto

Russia does not permit the use of crypto as payment within the country. However, the nation has opened its doors to crypto payments for import-export purposes. Additionally, authorities in the European Union banned European businesses from offering any crypto-related services to Russia following its full-scale invasion of Ukraine.

Moreover, being sanctioned by western powers, Russia and Iran are constantly on the lookout for alternative methods of trade. Crypto presents a perfect opportunity for both countries to continue their operations. Russia and Iran are likely looking into digital assets as an alternative to SWIFT payments.

Furthermore, in December 2022, in a move towards de-dollarization, Russia’s Sber (previously Sberbank) announced its first release of digital financial assets (DFA) backed by gold. The country has made repeated attempts to remove the dollar as the global standard. Iran and Russia have faced criticism for their geopolitical games, and it seems crypto is their latest tool.

At press time, the global crypto market cap stood at $1.02 Trillion, up by 1.4% in the last 24 hours.