Bitrabo Editorial
The integration of cryptocurrencies has emerged as a significant topic among the BRICS nations during a recent business forum that took place in Moscow on Friday.
The BRICS group, consisting of Brazil, Russia, India, China, and South Africa, aims to diminish its dependency on Western financial systems by creating an alternative payment method to the SWIFT network.
Push for Digital Currency Adoption
At the forum, Russian President Vladimir Putin encouraged BRICS countries to embrace cryptocurrencies and other digital currencies for their financial dealings to reduce their reliance on the US dollar.
Putin expressed optimism that BRICS and other developing nations could reap substantial benefits from adopting digital currencies and proposed the idea of delving into this option for the economic bloc.
UPDATE: BRICS to utilize digital currencies for investment growth. pic.twitter.com/i7u7JFsC55
— BRICS News (@BRICSinfo) October 18, 2024
He noted that discussions among BRICS nations regarding the use of digital currencies in investment initiatives are crucial and emphasized that not only BRICS countries but also “other developing and emerging economies” stand to gain from the shift toward crypto.
However, he acknowledged the necessity of creating comprehensive regulations beforehand and underscored the importance of establishing a solid regulatory framework, governed by BRICS nations, before venturing into cryptocurrency adoption.
Growing Trend of Crypto Adoption
The adoption of digital currencies like cryptocurrencies is on the rise as they allow users to circumvent traditional banking methods.
Additionally, many nations are implementing Central Bank Digital Currencies (CBDCs), which are virtual representations of their country’s currency, typically issued and monitored by central banks.
Among BRICS members, Russia and China have already begun to explore digital currency applications.
Russia plans to initiate pilot testing for its digital rouble in July of the upcoming year. This preliminary phase will involve selected individuals and businesses making purchases using the digital currency.
Meanwhile, China has made remarkable strides with its Digital Currency Electronic Payment (DCEP), also known as e-CNY. This digital currency, launched by the Chinese government, is managed by the Central Bank of China and aims to satisfy the public demand for innovative payment options.
By the end of 2021, approximately 261 million digital wallets were opened through this initiative, facilitating transactions totaling 87.565 billion Chinese yuan.
Introduction of BRICS Pay
In addition to digital currencies, BRICS has unveiled a new payment system devised to compete with the SWIFT financial framework.
BRICS Pay was officially launched by member states and is regarded as a significant advancement in transforming financial transactions within the BRICS bloc. This blockchain-based platform will simplify cross-border transactions among its members and serve as an alternative to SWIFT, helping to circumvent US sanctions.
This initiative reflects the BRICS members’ goal of establishing an independent economic system that operates outside conventional power dynamics.
Image credited to The Moscow Times, chart from TradingView