Russian Energy Minister Says Will Accept Bitcoin for Oil and Gas Payments

Russian Federation Energy Minister Pavel Zavalny has raised the possibility of accepting Bitcoin as a payment method for oil and gas in "friendly countries" such as China and Turkey.

These countries could start paying for energy in Russian rubles, Chinese yuan, Turkish lira — or even bitcoin — instead of the international standard dollar, he said.

According to Russian news outlet RBC, Zavalny, chairman of Russia's State Duma energy committee, said at a March 24 news conference that he and representatives from China and Turkey have been discussing changing the preferred settlement currency for its largest exports.

“For a long time, we have been advising China to switch to ruble and yuan as settlement currencies. As for Turkey, it is lira and ruble. Currencies can be different, this is normal practice. If there is bitcoin, we will trade bitcoin.”

He further stated that "countries that do not have friendly relations" can buy their oil with rubles or gold. However, it is unclear whether Russia can change the terms of existing contracts with countries that pay in euros or dollars.

breaking news.

Russia now requires Europe to pay for gas in rubles.

40% of Europe's natural gas comes from Russia. That is 200-800 million euros per day.

Putin is basically saying: You want sanctions? Either pay in rubles or freeze.

— Richard Medhurst (@richimedhurst) March 23, 2022

Russia has been exploring avenues to circumvent international economic sanctions for its invasion of Ukraine. Major Russian banks have been removed from the SWIFT system to prevent them from conducting cross-border payment settlements, and most businesses have been banned from conducting transactions with Russia, except for oil and gas transactions.

Energy is Russia's most important export commodity, and it is also a key energy source that is difficult for Europe and other countries to replace. In 2021, oil and gas deals will provide Russia with $119 billion in revenue, according to Reuters.

Including electricity, kerosene, coal and natural gas, energy trade accounts for 53.8% of Russia's total exports of $388.4 billion in 2021, according to Russia Briefing .

The crypto market appears to be reacting positively to the news of the expansion of Bitcoin’s international use case. Bitcoin prices have risen 2.5% over the past day and are now near a 30-day high of $43,917, according to data from CoinGecko.

Larry Fink, chief executive of the world's largest asset manager BlackRock, may be watching his predictions for a new digital payment system become a reality. Global political instability could pave the way for countries to adopt digital currencies as an international settlement tool, Fink wrote in a March 24 letter to shareholders.

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