BRICS Countries Consider Blockchain-Based Stablecoin Settlements
The BRICS alliance, which includes Iran, Egypt, Saudi Arabia, Ethiopia, and the UAE, is considering using stablecoins for settlements and establishing a special communications channel between central banks.
The “BRICS Bridge” platform would interlink central bank digital currencies (CBDCs) between BRICS countries, fostering economic cooperation. Moscow has been advocating for a blockchain-based solution due to increasing U.S. sanctions from the Ukraine war.
Russia is currently testing its digital ruble with over 25,000 successful transactions as of March 2024. The proliferation of dollar-backed stablecoins is causing concern in Washington, as the U.S. has no control over their use and cannot impose sanctions.
The Brookings Institute and Senator Elizabeth Warren have called for more robust stablecoin regulation and anti-money laundering rules. BRICS challenges the U.S.’s financial hegemony by using stablecoins and its CBDC bridge to settle payments between members.
(With inputs from Shikha Singh)
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