Russia To Bring Back the Gold Standard via Gold-Backed Cryptocurrency
The Central Bank of Russia (CBR) is reportedly checking out a proposal to create a gold-backed cryptocurrency which Russia could use in the future for cross-border settlements with other nations, and bring back the gold standard.
Vladimir Gutenev, Russian State Duma member initially proposed a gold-backed cryptocurrency for the country in August of last year and they are currently discussing on it. Elvira Nabiullina, the head of the CBR, commented on Gutenev’s proposal recently, stating:
As for mutual settlements, we will consider, of course, a proposal on a cryptocurrency that is tied to gold. But, in my opinion, it is more important to develop settlements in national currencies.
Gutenev’s proposal would see the country back its cryptocurrency with the precious metal as he believes most cryptocurrencies aren’t secure because they “aren’t backed by anything.” If the crypto’s value is tied to a real asset, then its price will remain relatively stable.
According to RT, Nabiullina added that the CBR is “in principle” opposed to the introduction of cryptocurrencies in Russia’s monetary system, as it doesn’t see them “fulfill the function of monetary surrogates.”
According to her, the regulator could look into launching stablecoins while there’s a real asset behind them. This also applies to Gutenev’s proposed gold-backed cryptocurrency. According to CBR official, Russia’s gold and foreign exchange reverses are to soon top $500 billion.