Russian Oil Conglomerate Rosneft May Soon Accept Cryptocurrency Payments to Avoid US Sanctions
- Russian oil company wants to create a cryptocurrency to deal with US sanctions.
- The Russian Duma is still working to regulate the crypto industry locally.
Using Cryptos to Pay For Oil
Cryptocurrency is still a subject of plenty of conversation in Russia, especially as the public waits patiently for regulations to be officially implemented. In recent comments, the head of the Rosneft oil company – Igor Sechin – made comments that imply that he is going to use cryptocurrency to pay for oil with his platform.
Sechin recently stated that there’s more awareness and acceptance of cryptocurrency at a global scale, which is why there are many companies that are looking to see how it fits in the energy industry. While at the St. Petersburg International Economic Forum, Sechin added that the new stablecoin from Facebook, which is better known as GlobalCoin, could possibly be an asset that would work with oil’s needs. Still, there are plenty of developmental issues that need to be addressed for more energy giants to get involved.
Russia Planning to Purchase Bitcoins
Sechin added, “Greater flexibility often means greater volatility, and digitalization creates risks for maintaining commercial secrets and leads to the need to create new regulatory mechanisms, additional reservations.” He further noted that the companies involved in the technology industry are simply unable to sufficiently solve these concerns.
Vladislav Ginko, a mouthpiece of Kremlin, went on Twitter to comment about cryptocurrency, saying that he told Telegraph that Russia has planned to collect their own Bitcoins in January. He added that the purpose of collecting this cryptocurrency has to do with international trading, avoiding interaction with any US sanctions.
Today Russia's big oil boss Igor Sechin (of Rosneft) has said that it'd be possible to accept cryptocurrencies as a mean of payment for oil dispatches. I've told https://t.co/7Kgln7K4a1 in January Russia's gonna accumulate Bitcoins for international trade to avoid US sanctions
— Vladislav Ginko (@martik) June 6, 2019
In the past, Ginko has been known for his bold statements that the Bitcoin holdings of Russia, saying that they have been accumulating billions of dollars. He added that there was already a plan in place for Kremlin to replace the USD reserves with Bitcoin, which eliminates the effects of US sanctions on the economy in Russia.
Continuing, the economist spoke about the way that Russia was getting involved with cryptocurrency to protect their national interest if there is ever a point when the US leverages USD’s power against trade interests.
Lack of Regulatory Clarity Regarding Cryptos
Based on the activity in Russia, Vladimir Putin appears to be fairly friendly to the use of cryptocurrency recently. In fact, there is even a budget established by Putin that will support researchers in their endeavors with blockchain technology and AI technology, discovering what they can do for Russia and the rest of the world.
Regulating cryptocurrency has been a rather complicated process with the Russian Duma, even though the private sector has been working to establish an oil-backed cryptocurrency. The head of the Energia investment firm, Igor Yusufov, is behind the latter token, using his experience as a former Russian minister of energy to find the balance between the oil industry and the US sanctions.
According to Yusufov, the Russian oil industry could easily be rescued from US political decisions with the use of digital currency. However, there is still a worry that an oil-backed asset will see the same fate of Petro, which has failed to be accepted by trading partners in Venezuela. Furthermore, in Venezuela, it is clear that the public prefers Bitcoin over the digital currency issued by the country, which appears to be due to how centralized the Petro actually is.