- El Salvador proposes crypto trade with BRICS, aiming to reduce dependence on the US dollar and enhance economic cooperation.
- Russia’s new crypto trade law enables El Salvador to simplify trade and evade Western sanctions, boosting bilateral trade.
- El Salvador’s crypto integration with BRICS signals a major shift in global trade dynamics, challenging US dollar dominance.
El Salvador recently proposed using cryptocurrency for trade with the BRICS alliance, aiming to reduce reliance on the US dollar. This move follows Russia’s recent legislation allowing crypto for international trade. The legal shift, set to take effect in September, allows Moscow to circumvent Western sanctions.
Simplifying Trade and Strengthening Economies
Russian diplomat Alexander Ilyukhin stated this measure would simplify trade for El Salvador, where the dollar is the official currency. The proposal marks a step in El Salvador’s ongoing efforts to integrate cryptocurrency into its economy. Furthermore, it aligns with the BRICS alliance’s goal of de-dollarization and boosting the use of its own currency.
The BRICS alliance has focused on reducing reliance on the US dollar in recent years. The group seeks to shift international economic dynamics away from Western influence. Russia’s legalization of crypto for trade represents a major stride in this direction. Hence, El Salvador’s proposal could signal a new era of economic cooperation between the two nations.
Overcoming Trade Challenges and Western Pressure
Moreover, Ilyukhin highlighted the difficulties in trade settlements due to El Salvador’s dollar dependency. He noted that El Salvador faces pressure from the West over this proposal. However, the diplomat emphasized the potential benefits of increased cooperation through crypto trade. This move could enhance trade volumes between El Salvador and BRICS nations.
Additionally, El Salvador’s interest in joining the BRICS alliance could further solidify these economic ties. Although the country has not yet applied for membership, the potential for collaboration is evident. Consequently, El Salvador’s connection to Bitcoin and other cryptocurrencies could facilitate smoother and more efficient trade with BRICS nations.
A Growing Trend in Global Trade Dynamics
El Salvador and Russia’s trade has increased in recent years. Trade volumes exceeded $4 million in 2018 and doubled in 2019. Trade hit $20 million by 2020. With the planned usage of cryptocurrencies, this growing tendency is probably going to continue, further undermining the dollar’s hegemony.
Trade deals using cryptocurrencies could strengthen El Salvador’s and the BRICS countries’ economies. The action highlights the growing adoption of digital currencies in international trade and challenges the global hegemony of the US dollar. Thus, El Salvador’s proposal to trade using cryptocurrency with the BRICS represents a turning point in the dynamics of the world economy.
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