Could Purchasing Energy Using Bitcoin Help Russia Evade Sanctions?

Bitcoin mania has continued to sweep the globe, attracting first-time investors as well as governments looking to get in on the action, even as the price of Bitcoin continues to rise dramatically, topping out at $44,000 at the end of March. At the same time, the cryptocurrency continues to battle against a more unsavory side of its reputation, having become a frequently-used payment method for black-market and otherwise less-than-legitimate activities.

As it turns out, Bitcoin’s facilitation of anonymous transactions that avoid traditional financial institutions may have a more significant application: according to remarks by Chair Pavel Zavalny of the Committee on Energy of Russia’s Duma, the embattled nation is considering Bitcoin for international energy transactions.

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The news comes at a time when Russia has been cut off from traditional international payment platforms including the SWIFT system and fintech options such as PayPal. As a means of retaliating against what Russian President Vladimir Putin has termed “unfriendly countries,” most of the current consumers of Russian oil and natural gas are now being forced to pay for these commodities in Russian rubles. By contrast, “friendly” countries such as Turkey and China may pay in their own national currencies . . . or, as Zavalny said, “You can also trade bitcoins.”