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At the sixteenth annual BRICS Summit in Kazan, Russia, several leading members discussed cryptocurrency’s role in de-dollarization. The Presidents of Russia, China, and Iran all stressed the need for new digital platforms.
The core of this de-dollarization effort is BRICS Pay, a payment solution platform based on blockchain technology and CBDCs.
BRICS Summit 2024
The sixteenth annual BRICS Summit has officially kicked off in Kazan, Russia, and one topic has risen to prominence: de-dollarization. At the BRICS Business Forum days prior, Russian President Vladimir Putin discussed using crypto assets and central bank digital currencies (CBDCs) for secure payments. Now, the topic has grown even further:
“There is an urgent need to reform the international financial architecture, and BRICS must play a leading role in promoting a new system that better reflects the profound changes in the international economic balance of power,” said Chinese President Xi Jinping.
The core of this reform is the nascent BRICS Pay system. This proposed model will use blockchain technology and CBDCs to facilitate payment options.
The system is not operational yet, but BRICS members have long discussed it as a de-dollarization strategy. A mockup of a possible new currency for this system was also presented at the Summit.
In other words, discussions have moved beyond the hypothetical. The BRICS Business Council’s Annual report explicitly discussed the urgency of finalizing these alternate economic platforms.
Some representatives advocated a system based on CBDCs like the digital yuan. This mirrors El Salvador’s main reason for making Bitcoin legal tender: further economic independence.
As Matthew Sigel, Head of Digital Assets Research at VanEck, reported, CBDCs are not the only assets up for debate. Russian lawmakers introduced the possibility of using Bitcoin and other assets to pay for imports, also bypassing dollar hegemony. Cryptocurrencies are consistently at the forefront of discussion for BRICS’ new economic infrastructure.
Although BRICS has been considered “an informal club” rather than a concrete force, prominent members have joined the de-dollarization plan. According to Iranian state media network IRNA, for example, Iranian President Masoud Pezeshkian proposed “international mobile payment systems,” “a shared e-commerce platform,” and other similar digital solutions.
Between China, Russia, Iran, and numerous other members, the BRICS Summit may gather enough cooperation and approval to move de-dollarization efforts forward. Representatives of the world’s major economies have all joined to discuss blockchain and cryptocurrency solutions.