BRICS payment system aims to de-dollarize using blockchain technology
According to a report by Crypto Guru, the recent announcement of the BRICS payment system has led to 159 countries around the world expressing interest in abolishing the dollar and replacing SWIFT. By introducing a new payment system just two weeks ago, these countries have shown their willingness to adopt it, posing a challenge to the popular US banking system.
The BRICS alliance said in July last year that its new payment system would facilitate cross-border transactions and settlements without relying on the US dollar. The move could change the balance of economic power in global markets, according to an article by Eric Herzog in Crypto Guru. A Russian official also confirmed that some 159 countries are ready to adopt the new system.
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It is also being discussed whether a gold-backed currency could be introduced at the next BRICS summit in October 2024. In addition, local currencies could be used for cross-border payments via the blockchain platform to counter SWIFT's dominance.
But despite these efforts, it remains difficult to completely replace the dominance of the US dollar – especially in trade with Western powers. “We believe that creating an independent payment system for BRICS is an important goal for the future,” Kremlin adviser Yuri Ushakov told the TASS news agency earlier this year. It should be based on modern digital technologies such as blockchain and offer benefits to governments, citizens and businesses.
Cryptocurrencies could be a powerful bridge between BRICS countries and support international traders. Even Western countries are showing interest in cryptocurrencies; Donald Trump, for example, has promised to make Bitcoin the US reserve currency. Last week, Russian President Vladimir Putin signed a law on cryptocurrency mining and its use in cross-border payments — especially important in light of the severe US sanctions following the invasion of Ukraine.
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