Following recent legal changes in Russia related to digital currency, El Salvador has proposed using digital currency for transactions with BRICS in order to eliminate the US dollar - according to the Watcher.guru website.
This measure will simplify commercial transactions, as the greenback is the official currency of this Central American country.
On July 30, the Russian State Duma (Lower House) passed a law allowing for the testing of cross-border payments and digital currency transactions from September 1.
The Central Bank of Russia has committed to implementing the first digital currency payments under the trial regime before the end of this year.
Previously, the Central Bank of Russia had proposed a complete ban on the use of digital currency. However, issues related to import payments due to secondary sanctions forced Russia to change its stance.
Russia's legalization of digital currency may lead to significant changes in international trade opportunities within the BRICS bloc, which is actively working to de-dollarize.
Many experts believe that Bitcoin transactions cannot be checked or blocked by any government or bank.
For many years, de-dollarization has been a priority for BRICS. The group has sought to increase the use of member countries' currencies, aiming to establish a common BRICS currency and a common payment platform to replace the Western SWIFT system.
With Russia's legalization of digital currency for international transactions, El Salvador has proposed using digital currency for transactions with BRICS and abandoning the US dollar.
In an interview with the Russian news agency Izvestia, Alexander Ilyukhin, First Secretary of the Russian Embassy in Nicaragua and concurrently in El Salvador, said that this move could signal increased cooperation.
"There are difficulties in transactions between Russia and El Salvador because the US dollar is the official currency in El Salvador" - Ilyukhin noted, pointing out that El Salvador is facing "severe pressure from the West" over this proposal.
Additionally, the Russian diplomat stated that El Salvador is interested in joining BRICS in the near future.
El Salvador is interested in attracting foreign investment, mainly from BRICS countries, as the country understands that it needs to diversify its economic relationships, rather than focusing solely on the US and the World Bank.
The trade volume between Russia and El Salvador reached over $4 million in 2018, doubling the following year and continuing to increase, reaching $20 million in 2020. This figure may continue to rise as trade increases.
