Russia may issue a stablecoin backed by gold to use in international settlements, a high-ranking member of the Russian parliament has admitted. The matter has been discussed during a recent visit to Iran where officials have also signaled interest in such an initiative.
Iran and Russia Talk Stablecoin Payments for Bilateral Trade Settlements
The Russian Federation is considering the creation of a stablecoin backed by gold that can be employed for cross-border settlements, including with Iran, the chairman of the Financial Market Committee at the lower house of Russian parliament, Anatoly Aksakov, told the Parlamentskaya Gazeta newspaper.
“We discussed the issuance of stablecoins, digital financial assets (DFAs) backed by certain valuables. For example, I spoke about gold, gold bars, refineries can provide them, or centers where gold is stored, and DFAs are issued against these reserves,” the lawmaker explained after a visit by a Russian delegation to the Islamic Republic.
Such a stablecoin can then be used as a means of payment, in mutual settlements between Russia and Iran for example, Aksakov elaborated, also quoted by the Interfax news agency. He added that the proposal has been received with interest from the Iranian side.
The high-ranking member of the State Duma further noted that Iran has a large debt for goods supplied by Russia. At the same time, the Iranian currency, the rial, fluctuates significantly and has two exchange rates to the U.S. dollar — the official, approved by the Central Bank of Iran, and the market rate — which is inconvenient in terms of calculations for Russian exports.
News that Tehran and Moscow are discussing the possible launch of a digital currency backed by gold came out earlier in January when the head of the Russian crypto industry association told the business daily Vedomosti that Iran’s central bank is mulling over developing one with Russian participation. The token would be used to facilitate trade in the Persian region, the executive revealed.
Gold-Backed Russian Digital Currency First Proposed in 2019
The idea to issue a Russian gold-backed stablecoin was initially circulated in May 2019, during a meeting at the State Duma joined by the governor of the Bank of Russia, Elvira Nabiullina. At the time, the member of the house Vladimir Gutenev suggested that the central bank should initiate talks on the matter with the other BRICS countries and insisted:
Gold is the least vulnerable asset. We could probably find understanding in China, India, and Brazil.
“But these are rather not cryptocurrencies, maybe so-called stablecoins,” remarked Anatoly Aksakov, while Nabiullina indicated that the monetary authority is open to a stablecoin backed by a real asset. A proposal for a ‘golden ruble’ stablecoin was also featured in a report by the VEB.RF Institute for Research and Expertise released in the summer of 2022.
Pressed by Western sanctions, Russia and Iran have been also exploring options to use decentralized cryptocurrencies to circumvent restrictions in foreign trade. In August, last year, Iran placed its first official import order using crypto while Russia is taking steps to legalize cross-border crypto payments. A digital ruble and a crypto rial that are not backed by gold are also under development.
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