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El Salvador has proposed using crypto for trade with Russia to navigate financial constraints imposed by sanctions, according to a Russian embassy official.
El Salvador has proposed using Bitcoin (BTC) for trade with Russia, as the latter has limited options for maintaining financial ties with the South American country due to sanctions.
In an interview with the Russian state-owned newspaper “Izvestia,” Alexander Ilyukhin, the first secretary of the Russian embassy in Nicaragua and head of the office in El Salvador, highlighted the challenges of conducting trade with El Salvador, given that the country recognized the U.S. dollar as a national currency. Therefore, El Salvador has suggested that cryptocurrencies could serve as an alternative, the Russian official said.
“El Salvador is the first country to officially adopt Bitcoin as legal tender. Within the country, any tourist can pay for services using Bitcoin.”
Alexander Ilyukhin
El Salvador became the first country to adopt Bitcoin as legal tender in September 2021, a decision announced by President Nayib Bukele at the Bitcoin 2021 conference in Miami. Despite the offer, Ilyukhin noted that embracing crypto for cross-border trade at the current stage is unlikely as Russia banned crypto as a legal tender in early 2021.
“[…] Bitcoin is not widely used in our country, so we seek other ways to boost trade. The government of El Salvador is ready to continue economic cooperation with Russia.”
Alexander Ilyukhin
The discussion of crypto as a medium for trade comes amid broader efforts to facilitate financial transactions between the two nations. For the development of tourism, Ilyukhin said it’s crucial for Russians to be able to make payments freely in different countries, suggesting that cryptocurrencies might be the only viable option for now.
“A more pragmatic approach for our tourists would be payment using cryptocurrencies.”
Alexander Ilyukhin
Although Russia has banned cryptocurrency payments, legislative changes are on the horizon. As crypto.news reported earlier, the Russian parliament recently advanced two crypto-related bills in their first readings, which could potentially permit the use of digital assets for international trade with major partners like China, India, the UAE, and Turkey.