The BRICS grouping, comprised of Brazil, Russia, India, China, and South Africa, is set to embark on a groundbreaking initiative to create a payment system based on blockchain technology. This endeavor underscores a specific task for the year aimed at bolstering the role of BRICS in the international monetary system.
According to a report by Russian news agency TASS, Kremlin aide Yury Ushakov emphasized the importance of establishing an independent BRICS payment system. He highlighted the need for leveraging state-of-the-art tools such as digital technologies and blockchain to ensure convenience for governments, businesses, and individuals, while also prioritizing cost-effectiveness and depoliticization.
The move towards a blockchain-based payment system aligns with ongoing efforts within BRICS to reduce reliance on the US dollar in settlement transactions, a strategy commonly referred to as de-dollarization. Ushakov reiterated the group’s commitment to this objective, emphasizing the continuous development of the Contingent Reserve Arrangement, with a focus on diversifying currency usage beyond the US dollar.
In a separate report by TASS, it was revealed that Russia’s Finance Ministry, in collaboration with the Bank of Russia and BRICS partners, will establish the BRICS Bridge multisided payment platform. This initiative aims to enhance the global monetary system by fostering greater connectivity and efficiency in cross-border transactions.
The BRICS countries’ foray into blockchain-based payment systems comes amidst growing recognition of the potential of digital technologies to reshape the financial landscape. In a letter addressed to finance ministers from the Group of 20 (G20) nations, Klaas Knot, Chair of the Financial Stability Board, highlighted the importance of prioritizing crypto assets, tokenization, and artificial intelligence (AI) in global financial discussions.
The decision to explore blockchain-based payment systems underscores BRICS’ commitment to innovation and financial inclusivity. By harnessing the transformative power of blockchain technology, the group aims to forge a path towards a more resilient and efficient international monetary system.
As the global financial landscape continues to evolve, initiatives such as the BRICS blockchain payment system serve as a testament to the potential of collaborative efforts in driving innovation and fostering financial stability. With blockchain at the forefront of this transformation, BRICS nations are poised to play a pivotal role in shaping the future of finance on a global scale.
