Russia and Cuba Eye Cryptocurrencies for Settlements Amid Sanctions

Both facing sanctions, Russia and Cuba are looking into alternative options for cross-border payments, including cryptocurrencies, a Kremlin advisor has unveiled in Havana. Moscow is already developing a mechanism for crypto settlements to circumvent financial restrictions imposed over its invasion of Ukraine.

The governments of Russia and Cuba are considering the use of Russian rubles and cryptocurrencies to facilitate bilateral cooperation against the backdrop of sanctions imposed on both nations. The news comes from a statement made by Boris Titov, commissioner for entrepreneurs’ rights under the Russian president, who visited Havana. Russia’s business ombudsman arrived in the Cuban capital during the 38th edition of the Havana International Fair.

“All of us, Cuba and Russia, are under sanctions, the dollar turnover is the main financial mechanism that exists in the world for mutual settlements, but today mechanisms are being developed at the level of national governments to change the situation,” Titov told the Tass news agency.

He further elaborated that several options are currently being discussed, including settlements in rubles. But the Kremlin official also noted that business is often quicker to adapt and find its own ways to make payments, including through cryptocurrencies and private clearing schemes.

Feria Internacional de la Habana (FIHAV 2022) is held Nov. 14 – 18 in the Expocuba exhibition complex on the outskirts of the city and was organized in 1983. The event is attended by representatives of companies from over 60 countries, including Brazil, Venezuela, Spain, Italy, Canada, China, Mexico, Russia, and France.

Russian authorities have been mulling over a more comprehensive regulatory framework for crypto assets for months. Lawmakers in the State Duma are expected to review a new bill “On Digital Currency” and a draft law “On Mining in the Russian Federation” tailored to fill the gaps remaining after the enforcement of the law “On Digital Financial Assets” in January, 2021.

While in January of this year the Central Bank of Russia suggested a blanket ban on most crypto-related activities, the increasing sanctions pressure since the launch of Russia’s “special military operation” in Ukraine in late February, convinced the monetary authority to back proposals to legalize the use of decentralized digital currencies in international settlements.

In September, Russian financial authorities started designing a mechanism to facilitate the employment of cryptocurrencies for payments with other nations. Earlier that month, Deputy Minister of Finance Alexey Moiseev revealed his department and the Bank of Russia had agreed that Russia “can’t do without cross-border crypto payments.”

Do you think Russia will manage to convince Cuba and other sanctioned nations to trade in rubles or cryptocurrencies? Share your thoughts on the subject in the comments section below.