Russia considers using cryptocurrency for arms deals

The Russian Engineering Union (“SoyuzMash”) in conjunction with an expert council from the State Duma’s defense industry commission has asked the Central Bank of Russia to consider the possibility of cryptocurrency payments for arms deals with foreign customers, announced Russian MP and SoyuzMash vice-president Vladimir Gutenev.

“We suggested a whole range of measures, and I personally made a suggestion to [Central Bank Head Elvira] Nabiullina. She is currently discussing it. The so-called ‘stablecoins’ are cryptocurrency backed by material valuables, especially gold. That is to say, anonymous payments are one of the possible ways to resolve the existing problems,” Gutenev explained, referring to the difficulties Russia is facing in its arms deals due to sanctions.

He added that there are new conditions governing arms deals. “It’s hard to name any new conditions with respect to competition, because of course, this is not a competitive environment, it is powerful sanction pressure. Whereas previously there were a few reference points according to which one could say that a contract had been fulfilled, we are now encountering cases where for months the delivered equipment and adopted equipment is not paid for, the transactions are very difficult to carry out,” the Russian MP noted.

The expert council on military and technological cooperation, part of the State Duma’s commission on legal support for the development of defense industry organizations, was established in spring 2019 at the recommendation of SoyuzMash president Sergey Chemezov. The council’s objective is to formulate the technical requirements for development in the area of production, diversification of the defense industry, and promotion of domestic products, including on the civilian market. Dmitry Shugaev, director of the federal service for military-technical cooperation, was appointed as chairperson of the committee with the consent of Defense Minister Sergey Shoygu.

  Russia, State Duma, cryptocurrency, Soyuzmash, Shoygu