Russian Commodities Firms Turn to Stablecoins for Transactions with Chinese Counterparts

cryptonews.com:

Russian commodities firms facing challenges in executing financial transactions with Chinese counterparts have turned to stablecoins.

In response to international restrictions and tightening compliance measures, these firms have turned to cryptocurrencies, including Tether’s stablecoin, to facilitate cross-border transactions with their Chinese clients and suppliers, according to a recent report from Bloomberg.

The report said that top executives from two major unsanctioned metals producers have confirmed their utilization of stablecoins for transactions.

Some settlements are conducted through Hong Kong, providing a workaround for the difficulties faced by Russian firms in receiving payments for their goods and purchasing equipment and raw materials.

JUST IN: US Treasury Deputy Secretary issues official statement to Senate Banking, Housing, and Urban Affairs Committee, claiming Russia is using #Tether’s $USDT stablecoin to bypass economic sanctions. pic.twitter.com/M3z1jnJZoF

— Jacob Kinge (@JacobKinge) April 9, 2024

The adoption of blockchain technology and stablecoins by Russian firms highlights the lasting impact of international restrictions imposed in response to the conflict in Ukraine.

Even in China, which has not imposed sanctions and has become a key export market for Russian commodities, financial transactions have become more challenging due to the threat of secondary sanctions from the US Treasury Department.

Stablecoins offer advantages such as faster transactions and lower costs compared to traditional methods.

“With stablecoins, the transfer may take just 5-15 seconds and cost a few cents, making such transactions pretty efficient when the sender already has an asset base in stablecoins,” said Ivan Kozlov, an