Will Russia actually trade oil for bitcoin?

Russia accepts payments for its oil in Bitcoin. Payment with bitcoin is only allowed in friendly countries. They have a choice as they can pay with bitcoin or in their local currencies. The goal behind allowing crypto transactions is to boost the Russian currency. The ruble has shown a fall of around 20% this year. Sanctions imposed by some significant economic relations in trade relations with Russia have put a strain on the Russian ruble, leading to a decline in the value of the ruble in international markets. Keeping these things aside, Russia is still the largest exporter of natural gas and ranks second in oil supply.

Russia is constantly finding new payment options to receive payment for its energy exports. Russia is looking for alternative ways to pump up its economy, and bitcoin is seen as a high-growth asset spread around the world. Accepting bitcoin and other cryptocurrencies for export payments can lead to a better step in economic growth. The volatility of crypto could cause the Russian economy to jump again in the same place. Learn more about revolution of Bitcoin here.

Use of bitcoin for oil trading: –

The sanction imposed by the United States

Russia uses bitcoin for its energy exports due to the sanctions imposed by the United States, restricting Americans from ending business relations with Russians. Sanctions could force Russia to use other payment methods like bitcoin or any stable cryptocurrency like USDT. It would benefit Russia to increase its imports and exports. The use of crypto can make cross-border transfers easy through the use of bitcoin will make peer-to-peer transactions reduce the involvement of countries’ central authorities such as banks.

US sanctions could increase Russia’s use of digital currency in its export imports. Sanctions have also created an opportunity for Russia to create its digital ruble just as China has created its digital Yuan. The Central Bank of Russia and the Central Bank of Digital Currency have admitted that the digital ruble will enter the financial system. It will provide security against illegal and incorrect use of money. Thus, the creation of the digital ruble bye will bypass all the trade sanctions imposed on Russia.

How to attract more buyers: –

Adding one option to your business will surely help in increasing the number of customers and increase the trade. Russia finds it difficult to sell oil with a centralized platform due to some sanctions imposed on the country after the war between Ukraine and Russia. Moreover, the world trade market is highly dependent on the US dollar. Using bitcoin in oil will bypass the sanctions and settle the oil payments outside the sanctions criteria. It will help Russia find new buyers on the global market.

Putin still demands that the unfriendly countries pay in the ruble. There are two reasons behind Putin’s demands

• Receiving payment in one’s domestic ruble currency will end the sanctions imposed on bank transactions.
• That will help boost the ruble, which has fallen to as much as 25% due to the Russia-Ukraine war.

But accepting crypto is not a long-term solution for Russia, as crypto markets are highly volatile. The values ​​of crypto have fallen to about 50%-75% compared to values ​​in November 2021. can use it for a short period to avoid sanctions as a crypto transaction does not flow from any centralized channel. One of the most significant losses of exchanging oil for crypto is that Russia’s friendly trading partner is China, and China has banned the use of cryptocurrency in China. In addition, China has introduced its own centralized digital currency digital Yuan.

Conclusion:-

Russia will actually look for another currency instead of the dollar. Russia may soon move away from the US dollar. The US sanction was only for the Russian government, but it caught the ordinary Russians in sanction. It is correct to say that the entire Russian economy is being targeted through the implementation of sanctions. But on the other hand, using bitcoin for oil trading is a completely new concept for Russian economy. Bitcoin does not affect any country, which involves sanctions or other rules and regulations. It is out of central channels at the moment bitcoin has boosted the Russian ruble and helped Russia continue its trade around the world.