Sergei Glazyev, minister of integration and macroeconomics of the Eurasian Economic Union (EEU), has noted the advancements the adoption of central bank digital currencies (CBDCs) could ostensibly bring to the trading dynamics of the region. According to Glazyev, the launch of several digital currencies will allow countries to settle trades outside of the U.S. dollar as early as next year, leading to the rise of a new reserve currency.
Eurasian Economic Union Hopes to Move to CBDC Settlements
The Eurasian Economic Union (EEU) expects that the rise of several central bank digital currencies (CBDCs) will pave the way for the issuance of a new reserve currency different from the U.S. dollar. Sergei Glazyev, minister of integration and macroeconomics of the Eurasian Economic Union, talked about the future benefits these digital, blockchain-based technologies might bring to the trading processes between countries of the EEU and even BRICS countries.
In statements given to Sputnik on Tuesday, Glazyev stated:
I believe that the development of digital technologies and the already announced plans for the introduction of the digital ruble, the digital yuan and the digital rupee will lead us, perhaps as early as next year, to move first to digital settlement in national currencies.
The EEU consists of several post-Soviet Union states, including Armenia, Belarus, Kazakhstan, Kyrgyzstan, and Russia, having a gross domestic product of $2.4 trillion.
An Easier Route to Trade: The Road to a New Digital Reserve Currency
The minister also emphasized the benefits of changing the settlement methods from the current legacy system that uses banks to a blockchain-based payment method.
Glazyev stressed:
This is much easier than going through banks. There are no endless restrictions and regulatory fears of sanctions. Digital currencies allow trading operations to bypass banks.
Since the start of the Russia-Ukraine conflict, the Russian Federation has been the target of a stringent set of sanctions that made it change its commercial relations to focus on trading with friendly countries.
Nonetheless, even companies of these friendly countries making trades with Russia can be affected by sanctions targeting their use of U.S.-based fiat systems, with U.S. officials comparing such actions to “playing roulette.”
Glazyev trusts that launching these digital currencies and building of a settlement system harnessing them will serve as the base of a new digital currency, to substitute the reserve currencies proposed by the International Monetary Fund (IMF), based on an international agreement.
What do you think about the hypothetical rise of a new digital reserve currency different from the U.S. dollar? Tell us in the comments section below.
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