Russia is in the final stages of developing its own oil-backed cryptocurrency. This is according to a report by Russian news media outlet, Rambler. The development follows the anticipated adoption of new crypto laws by the State Duma, the lower house of the Federal Assembly.
The report cited Oleg Nikolaev, a member of the Economic Policy Committee at the State Duma. He revealed that the house is finalizing the legal framework for the blockchain and crypto industry. Once approved, the new framework will support the development of the crypto industry in the country.
And according to Russia’s former Energy Minister, Igor Yusufov, the first project the country will work to complete is the development of an oil-backed cryptocurrency. The crypto was proposed by the head of the Energia Corporation. This project is now at its final stages, Yufusov revealed.
The benefits of an oil-backed crypto for Russia will be immense, Yufusov stated in the interview. For one, it will enable Russia to avoid the unpredictable exchange rate fluctuations. This will go a long way in eliminating trade restrictions. He said:
“Such a project can make a significant contribution to the development of the Russian and international digital ecosystem and set a new bar for commercial infrastructure, the use of blockchain and smart contracts for non-financial services.”
With Russia being at odds with the U.S more often than not, the oil-backed crypto will reduce its dependence on the dollar. It will also open up trade with other oil-producing countries, especially those in the OPEC region, Yufusov pointed out.
The value of the crypto can be tied to either one of two pegs- a ton of conditional fuel or the value of conditional CO2 emissions. In the future, the currency and the blockchain network underpinning it will extend their uses, Yufusuv believes. One future use will be the collection and analysis of information.
“The traceability of the transaction trace, characteristic of the blockchain, will ensure the origin of each barrel and verify the entire chain from production to the final consumer without additional costs,” he stated.
In the future, the crypto will be applied in other fields apart from oil, he stated. However, for now, oil offers the easiest route to the crypto domain.
Yufusuv further pointed out that the recent launch of the JPM Coin by JP Morgan is an indication of where the market is heading. Despite being opposed by many, cryptos will find a way to dominate the payments networks in the future.
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