Iran, Russia Reportedly Mull Creating Common Digital Currency

A general view shows the Iranian capital Tehran with the snow-covered Alborz mountain range in the background on January 7, 2023InternationalIndiaAfricaOleg BurunovLast year, Russia and Iran started to expand the use of national currencies in foreign trade settlements against the backdrop of the Western sanctions slapped on the two countries. Moscow and Tehran are discussing the creation of a Persian Gulf token that could replace the dollar, the ruble and the rial in foreign trade transactions, a Russian media outlet has reported.The outlet quoted Alexander Brazhnikov, Executive Director of the Russian Association of the Cryptoindustry and Blockchain, as saying that the token will be used as a stablecoin, a digital currency that is pegged to a “stable” reserve asset like the US dollar or gold.WorldDumping the Dollar: Will China, Russia, Turkey, and Iran Create a New International Currency?24 March 2021, 12:18 GMTHe added that a special economic zone in the southern Russian city of Astrakhan would begin to receive cargo from Iran later this year, something that is expected to kick off the use of the Gulf token.

Alexei Voylukov, Vice President of the Association of Banks of Russia, for his part recalled in an interview with a separate Russian media outlet that currently, there are settlements in dollars between Russia and Iran, but due to sanctions, payments are made in the two countries’ national currencies.

According to him, the rapprochement between the two makes it possible to establish almost any system of payments between them. Sputnik has reached out to the Central Banks of Russia and Iran for comments on the matter.In July 2022, Iranian Economic Minister Ehsan Khandouzi announced that the Islamic Republic officially ditched the US dollar for trade with Russia. The same month, the Tehran Stock Exchange launched rial-ruble trading.RussiaRussia’s SWIFT Ban: EU Should Think Twice as It’s About to Shoot Itself in Foot, Journo Warns1 March 2022, 19:05 GMTThis came after an array of major Russian banks were disconnected from the SWIFT international payment system as part of the Western sanctions against Russia, which were imposed shortly after Moscow launched its special military operation in Ukraine on February 24, 2022.In 2019, SWIFT cut access for most Iranian banks under pressure from Washington, which earlier reinstated harsh economic sanctions against the Islamic Republic following then-US President Donald Trump’s announcement to unilaterally withdraw from the 2015 Iran nuclear deal, also known as the Joint Comprehensive Plan of Action (JCPOA).

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