Russia considers accepting Bitcoin for oil and gas

Image source, Getty Images

A high-ranking lawmaker said that Russia is considering accepting the payment of oil and gas exports in the form of virtual currency.

The countries that are friendly could be allowed to pay in their local currency.

Russian President Vladimir Putin said this week that he wanted unfriendly countries to buy his gas with roubles.

The Russian currency has lost over 20% in value this year.

Sanctions imposed by the UK, US and the European Union have put a strain on Russia's rouble and raised its cost of living.

Russia is the world's biggest exporter of natural gas and the second largest supplier of oil.

Image source, Reuters

Mr Zavalny said on Thursday that the country has been looking at alternative ways to get payment for energy exports.

He said China and Turkey were not involved in the sanctions pressure.

Mr Zavalny said that they have been proposing to China for a long time to switch to settlements in national currencies.

Mr Zavalny said you can also trade bitcoins.

Despite the risks, analysts said Russia may benefit from accepting the coin.

David Broadstock, a senior research fellow at the Energy Studies Institute in Singapore, said that Russia is feeling the impact of sanctions very quickly.

He noted that the value of the digital currency has changed a lot this year. The dollar has traded within 5% of the euro.

Mr Broadstock said that accepting the digital currency, like other traditional currencies, introduces considerably more risk in the trade of natural gas.

One of the major trade partners for Russia is China, and it is banned for use in China of cryptocurrencies.

There are fears that Russian billionaires could be using virtual currencies to avoid sanctions.

This has led to the governments of the US and Europe asking the platforms to ban all Russian users.

Some ordinary Russians are using cryptocurrencies as a way to survive the collapse of their currency, according to Brian Armstrong, chief executive of cryptocurrencies firm Coinbase.

Many of them likely oppose what their country is doing, and a ban would hurt them as well.

The currency went to a three-week high after Mr Putin said that countries pay in roubles.

It's not clear if Russia can change existing gas contracts in euros. 40% of the EU's gas comes from Russia.