TL;DR
- BRICS plans to create a blockchain-based payment system and digital currencies to reduce dependence on the US dollar in international transactions.
- They aim to promote efficiency and independence in financial transactions among member countries, ensuring convenience, profitability, and absence of political influences.
- This initiative is part of a broader plan to strengthen BRICS’s role in the international monetary system.
The BRICS group, composed of Brazil, Russia, India, China, and South Africa, has announced its intention to create a blockchain-based payment system and digital currencies. This initiative arises as part of a joint effort to reduce dependence on the US dollar in international transactions, a process known as de-dollarization.
The main objective of this independent payment system is to promote efficiency and independence in financial transactions among BRICS member countries. According to Yury Ushakov, Kremlin aide, the creation of this system will be based on advanced tools such as blockchain technology, with the aim of ensuring its convenience for governments, citizens, and businesses. Additionally, it is sought to be a profitable and free-from-political-influence system.
This decision is part of a broader plan to strengthen its role in the international monetary system. In addition to the creation of the blockchain-based payment system, the group is also working on the development of the Contingent Reserve Arrangement, which will allow the use of currencies other than the US dollar in international financial transactions.
BRICS Seeks Monetary Autonomy Through Blockchain
De-dollarization has been a long-term goal for many countries and groups, as it reduces exposure to dollar volatility and grants greater autonomy in monetary policies. For BRICS, this measure not only implies an economic change but also an affirmation of its position on the international stage.
In addition to the creation of the blockchain-based payment system, it is reported that Russia, along with the Central Bank of Russia and BRICS partners, will launch the multi-sectoral payment platform BRICS Bridge. This platform aims to improve the global monetary system, providing a solid infrastructure for financial transactions among member countries and beyond.
The letter sent by Klaas Knot, Chairman of the Financial Stability Board, to G20 Finance Ministers, underscores the importance of closely monitoring the development of crypto assets, tokenization, and artificial intelligence in the global financial context. These projects denote a clear recognition of the growing influence of technology in international finance.
