According to reports, the Central Bank of Iran and the Russian government are working together to issue a new stablecoin that is backed by gold to be used in overseas trade.
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Iran and Russia are collaborating to develop a “token of the Persian Gulf region” that would be used as a form of payment in international trade, according to the Russian news agency Vedomosti.
According to Alexander Brazhnikov, executive director of the Russian Association of Crypto Industry and Blockchain, the token would likely be released as a stablecoin backed by gold.
Instead of using fiat currencies like the US dollar, the Russian ruble, or the Iranian rial, the stablecoin intends to enable cross-border transactions. According to the article, the possible cryptocurrency would function in Astrakhan’s special economic zone, where Russia began to accept Iranian cargo shipments.
The Committee on Information Policy, Information Technology, and Communications member from Russia Anton Tkachev emphasised that a joint stablecoin initiative would only be feasible after the Russian digital asset market has been completely regulated. The Russian lower house of parliament once more pledged to begin regulating cryptocurrency transactions in 2023 after numerous delays.
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Russia and Iran are two nations that ban their citizens from making payments with cryptocurrencies like Bitcoin and stablecoins like Tether (USDT). Iran and Russia have both been working hard to use cryptocurrency in international trade at the same time.
Amid persistent international trade restrictions, Iran’s Ministry of Industry, Mines, and Trade approved the use of cryptocurrencies for imports in August 2022. The regional authority claimed the additional actions would assist Iran in lessening international trade sanctions. Iran then used $10 million worth of cryptocurrency to make its first ever foreign import purchase.
To lessen the effects of international sanctions, the Bank of Russia, which had previously opposed the use of cryptocurrency as a payment mechanism, agreed to permit it in overseas trade. However, the regulator has never made it clear which cryptocurrency will be utilised in these transactions.