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The BRICS bloc has officially adopted cryptocurrency for investments, marking a significant and bullish development on October 18. This announcement was made during the ongoing BRICS Business Forum held in Moscow, where Russian President Vladimir Putin characterized this decision as a potential game-changer for the alliance.
Upcoming BRICS Summit and Economic Policies
This announcement comes just in time for the eagerly awaited BRICS Summit 2024, which is scheduled for next week. During this summit, the bloc is expected to unveil a series of new economic policies, including the recently introduced blockchain-based BRICS Pay platform, which was presented to attendees at the forum.
Putin’s Vision for Digital Currencies
During the forum, President Putin emphasized the critical role digital currencies will play not only for BRICS nations but also for other emerging economies. He stated, “We will discuss the use of digital currencies in investment developments by BRICS member states, and this will also benefit other developing and emerging economies with good prospects.” He also mentioned the intention of the bloc to develop a regulatory toolkit ensuring proper oversight under BRICS institutions.
Strategic Shift from the US Dollar
The BRICS group, which includes Brazil, Russia, India, China, and South Africa, has been steadily increasing its economic footprint. Over the past year, the bloc has focused on diminishing its reliance on the US dollar for international trade, advocating for the use of local currencies instead. This shift follows Russia’s recent reversal of its digital assets ban for international payments, paving the way for a bold new strategy regarding digital currencies.
Introduction of the BRICS Pay Platform
In parallel with the adoption of digital currencies, BRICS is set to roll out the BRICS Pay platform, a blockchain-based system aimed at facilitating cross-border transactions among member nations. The platform was introduced at the forum and is anticipated to serve as a crucial tool for diminishing reliance on Western financial systems. Both Russia and China are particularly keen on its adoption to circumvent US sanctions and reduce dependence on the dollar in global trade.
Russia’s Digital Strategies and Future Plans
Furthermore, President Putin shared that BRICS members have already initiated the development of a financial messaging system similar to SWIFT, along with utilizing national digital currencies to support high-growth projects. These initiatives are part of a comprehensive long-term vision to fortify financial independence and enhance trade within the bloc.
Expansion of BRICS Membership
Putin addressed the bloc’s ongoing expansion, welcoming new members such as Egypt, Ethiopia, Iran, and the UAE. He also noted that interest has been expressed by over 30 additional countries wishing to join BRICS, with the forthcoming summit in Kazan expected to further discuss these potential additions.
Economic Growth Expectations for BRICS
Expressing confidence in BRICS’s potential for driving global economic growth in the coming years, Putin highlighted the bloc’s large and swiftly growing economies compared to their Western counterparts. He outlined Russia’s contributions to BRICS through new financial initiatives such as a joint cross-border payments system and the establishment of a reinsurance company.
Investment Focus and Digital Currency Implementation in Russia
Additionally, Putin urged the New Development Bank, BRICS’s multilateral institution, to invest in crucial areas including technology, infrastructure, e-commerce, and artificial intelligence, particularly in the Global South. In response to Western sanctions, Russia has accelerated its implementation of a digital currency strategy. In August, Putin signed laws legalizing crypto mining and permitting international crypto payments, enabling Russian businesses to engage in cross-border transactions using digital currencies. Furthermore, the Russian central bank is currently testing the digital ruble, with a full-scale launch anticipated in 2025.
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