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(KITCO News) – Central Bank of Russia announce On Monday, it agreed with the Ministry of Finance to legalize the use of cryptocurrencies for cross-border payments.
The central bank has been seriously rethinking its approach to regulating the cryptocurrency industry, and this latest development is an acknowledgment that crypto payments are inevitable based on current geopolitical conditions.
According to Alexi Moiseev, Deputy Minister of Finance of the country, many Russians rely on foreign platforms to open a digital currency wallet, and this is something that must be dealt with within the country using trusted platforms.
“It is necessary to do this in Russia, including entities supervised by the Central Bank, which are obligated to comply with anti-money laundering and KYC requirements,” Moiseev stated.
This announcement marks a shift in the country’s approach to using cryptocurrencies as a means of payment. The Digital Financial Assets Act of 2020 has officially banned the use of cryptocurrencies such as Bitcoin (BTC) for payment purposes.
In late 2021, Russian President Vladimir Putin suggested that it was “still too early” to use cryptocurrencies to facilitate the trading of energy resources such as oil and gas.
The economic sanctions imposed by the West on Russia in response to the invasion of Ukraine seem to have changed this perspective and made cryptocurrencies a more attractive option for cross-border payments.
Moiseev spoke about this, noting that the central bank has reconsidered its approach to regulating the industry “given that the situation has changed.” Some reworking of existing plans has to be done; However, the official said, the infrastructure planned is “too rigid” to use cryptocurrency in cross-border settlements.
China publishes more digital yuan smart contracts
Meanwhile, in China, the People’s Bank of China (PBOC) has announce It plans to deploy more smart contracts for its digital yuan after multiple new use cases emerged from the tests conducted on the new digital currency.
In a speech delivered last Friday by Mu Changchun, general manager of the Digital Currency Institute at PBOC, the official explained that smart contracts that include the digital yuan, or e-CNY, have been applied to areas such as government subsidies and retail marketing. Prepaid money management.
This development aligns with what the institute has put into e-CNY White papers It was released in 2021, which indicated that the currency will gain programmability through “the deployment of smart contracts that do not impair their monetary functionality.”
Mo noted that the next step will be to create smart contract models and put in place systems that help mitigate any risks to economic and financial stability.
“Smart contracts, in this sense, must undergo compliance reviews and testing before they are converted into templates and forms,” Mo said, noting that the People’s Bank of China is in the process of creating a platform for smart contract model review and registration.
PBOC initially started trial trials for e-CNY in Shenzhen in October 2020, and since then has expanded the trials to at least 23 cities and regions.
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