Facing Western sanctions, Russia and Iran are exploring the use of DFAs and central bank digital currencies (CBDCs) for mutual settlements, according to a report by Izvestia.
Rahimi Mohsen, the trade attaché of the Iranian embassy in Russia, stated that Tehran and Moscow are working on innovative solutions to simplify trade between the nations and mitigate the impact of sanctions.
Mohsen identified the main challenges as the creation of infrastructure and regulatory frameworks for these new payment methods.
Simultaneously, Russia and Iran are continuing discussions on creating a gold-backed stablecoin for cross-border transactions.
Experts told Izvestia that due to the inability to conduct transactions in dollars and euros, Russia and Iran have shifted to using national currencies. However, difficulties with conversion and discrepancies between Iran’s market and official exchange rates result in Russian businesses losing about 20–25% on each transfer.
Iran completed the development of a rial-backed CBDC in November 2018. Russia’s national digital currency law came into effect on August 1, 2023.
In late February, the State Duma authorized the use of DFAs and utility digital rights for international agreements.
The Bank of Russia stated it is open to discussing similar uses of cryptocurrencies, citing a “demand from exporters and importers under sanctions.”
In December 2023, the Exved exchange, focused on cross-border payments in foreign economic activities, was launched.