According to reports, one of Russia’s largest banks is introducing a brand-new cross-border payments system that makes use of cryptocurrency.
A spokesman of Rosbank reportedly stated that the organization is already carrying out test transactions with private and corporate clients, according to a recent report by the Russian publication Vedomosti.
Although it is unclear which digital assets the bank will enable for international transfers, Russian fintech company B-crypto will be in charge of the new protocol’s technical details.
According to a report by the RBC Group, clients must go through a KYC (know-your-customer) verification process with the bank and B-crypto in order to use the service.
Alexey Voylukov, vice president of the Association of Banks of Russia, claims in the study that large-scale institutions have not yet adopted crypto-focused cross-border payment services, which are often offered by smaller banks.
Vladimir Chistyukhin, the first deputy chairman of the Bank of Russia, points out that cross-border payments are not expected to completely replace international payments.
In an effort to restrict Moscow’s capacity to finance its conflict with Ukraine, the US Department of the Treasury imposed sanctions on Rosbank and Vladimir Potanin, who is thought to be the richest man in Russia and the bank’s owner, late last year.
Attorney Eduard Davydov, a senior partner at the Emet Law Firm, claims in the RBC Group report that Rosbank might be able to get around the penalties imposed on it by using the cross-border payment system.