Adopting crypto was one of the main discussions among BRICS member states during a business forum held in Moscow on Friday.
The BRICS (Brazil, Russia, USA, China and South Africa) is trying to reduce its dependence on Western financial systems by introducing an alternative payment system to the SWIFT payment network.
Digital currency adoption urgently required
During the forum Russian President Vladimir Putin urged BRICS members to adopt this proposal cryptocurrencies and other digital money in their financial transactions to reduce their dependence on the US dollar.
Putin believes the BRICS and other developing countries could benefit from embracing digital currencies, saying he would insist the economic bloc explore the possibility.
JUST IN: BRICS will use digital currency for investment developments. pic.twitter.com/i7u7JFsC55
— BRICS News (@BRICSinfo) October 18, 2024
He said the BRICS member states will discuss the use of digital currencies developments in the field of investmentsadding that BRICS members are not the only ones who will benefit from cryptocurrency adoption, but “other developing and emerging economies” as well.
However, he acknowledged that comprehensive regulations must be established first, while at the same time emphasizing the significance of creating a robust framework governed by the BRICS countries before diving into crypto adoption.
Crypto adoption on the rise
The number of economies embracing digital money, such as cryptocurrencies, has increased because it can be used to bypass traditional banking systems.
Others also adopt the so-called Central bank digital currencies (CBDCs), the digital versions of their country’s currency. CBDCs are typically issued and regulated by their central bank.
Two BRICS member states, Russia and China, have already explored the use of digital currencies.
Russia has announced that it will start testing its digital ruble in July next year. During the pilot implementation, selected individuals and companies will participate in the experimental trial in which they will make purchases using digital rubles.
On the other hand, China has made significant progress in this area through its digital currency electronic payment (DCEP). DCEP, also known as e-CNY, is a digital currency initiated by the Chinese government and currently operated by the Central Bank of China. It is China’s answer to the public’s call for a modern payment solution.
By the end of 2021, the initiative opened approximately 261 million individual wallets and carried out transactions worth 87.565 billion Chinese yuan.
BRICS Pay launched
In addition to digital currencies, BRICS presented a new payment platform that will challenge SWIFT’s financial system.
Member states have officially unveiled BRICS Pay, which is considered a milestone in revolutionizing financial transactions among BRICS members. The blockchain platform would streamline cross-border transactions within the bloc, serve as an alternative to SWIFT and circumvent US sanctions.
Furthermore, BRICS Pay reflects the ambitions of the bloc’s members to establish a self-sustaining economic framework free from the control of traditional power structures.
Featured image from The Moscow Timeschart from TradingView