Russians set to turn to crypto in droves

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Source: Billion Photos/Adobe

A Russian professor has claimed that “mass” adoption of crypto is happening in the country – with interest in digital versions of the Chinese yuan and ruble also on the rise.

Per V1, the crypto predictions were provided by Igor Belskikh, Doctor of Economics and Professor at the Department of Economics and Finance, Russian Plekhanov University of Economics.

Belskikh said the crypto is already gaining “more and more popularity” in Russia. He noted that cryptography had become a tool for Russians, for example, to “transfer” funds abroad without having to report to the government.

He said the recent “popularity” of crypto was “associated with the ability to move money quickly across borders without incurring exchange fees or paying taxes.”

He noted that customs officers were largely powerless to “take coins from migrants”. And he said these are the reasons “everyone” is now “running” into crypto.

Belskikh added that “cryptocurrencies could become the most massive hobby for Russians in the coming years.”

The professor added that “thousands of Russians” have already used crypto as a stealthy tool in currency trading. He noted that they use rubles to “buy cryptocurrencies” and “when they come to other countries, they just convert them into local national currencies.”

He added that Russians have used crypto in this way to “buy real estate, stocks, and bonds,” as well as “to pay for their education.”

The professor claimed that governments in Russia and elsewhere have lagged far behind investors, which means it is relatively easy for crypto users to keep their coin holdings – and their use – private.

Crypto, Belskikh concluded, has “come to ‘our world’ ‘in earnest’ and ‘forever.’

Russia Turns to Crypto… and the Yuan?

Meanwhile, sanctions that were meant to freeze Russia out of the dollar-fueled global economy have reportedly driven ordinary Russians — and the Moscow-based government — to seek digital and analog alternatives to the greenback.

Late last month, Russian firm Lighthouse issued “digital financial assets” worth around $8.3 million, backed by commercial debt. The company is one of the few companies authorized by the Central Bank to deal in “digital financial assets”.

Although these digital coins are not quite the same as bitcoin (BTC), this decision indicates that things are changing rapidly in Russia.

For example, even the crypto-skeptical central bank recently expressed its approval for crypto-related pilots.

Russian interest in the digital yuan and its conventional alternative is also on the rise. Cankaoxiaoxi said the yuan accounts for 7% of foreign currency deposits held by customers of Russian bank VTB. About 1% of foreign currency deposits with Tinkov Bank are yuan holdings.

But that number is expected to rise sharply – and banks have already met the anticipated demand. At the beginning of 2022, only 13 Russian banks offered services in yuan. That number has since risen to 50.

Observers have noted that Russian interest in digital yuan holdings would likely increase rapidly in Russia if, for example, citizens could bypass banks altogether and buy e-CNY through apps on their mobile phones.

Could the digital yuan, the digital ruler, become international?

Moscow has also expressed interest in using its digital ruble in trade deals with Beijing. China, for its part, has distanced itself from public claims about cross-border digital yuan benchmarks. But plans are already in place to test cross-border interoperability in a Hong Kong e-CNY pilot.

Beijing could also potentially seek to use the digital yuan to bolster its “petroyuan” plans – efforts to create an alternative to the USD in oil trading. De-dollarization has already started in earnest in Russia and China, where gold buying hit record highs in 2022, the Financial Times reported.

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