Russia plans to use the digital ruble in a settlement with China, a lawmaker told Reuters.

© Reuters FILE PHOTO: State Duma Economic Policy Committee Chairman Anatoly Aksakov attends a meeting of the St. Petersburg International Economic Forum (SPIEF) in St. Petersburg, Russia, June 16, 2022. REUTERS/Maxim Shemetov/File Photo

MOSCOW (Reuters) – After launching a digital ruble early next year, Russia plans to share the currency with China as it seeks to reduce Washington’s global financial dominance, a senior Russian lawmaker said on Monday.

Russia, like many other countries, has been developing digital currency over the past couple of years to modernize its financial system, speed up payments and counter the threat of influential cryptocurrencies like bitcoin.

The central bank is conducting bank-to-bank trials of a digital ruble as sanctions against Moscow over its actions in Ukraine affect Russia’s access to global financial market infrastructure.

With this in mind, Russia is looking for alternative ways of trading, said Anatoly Aksakov, head of the Finance Committee of the Russian Lower House, in an interview with the Russian Parliamentary Newspaper.

“The topic of digital financial assets, digital ruble and cryptocurrencies are gaining strength in society as Western countries are imposing sanctions and creating problems with bank transfers,” Aksakov said. The digital direction is key as financial flows can bypass systems controlled by unfriendly countries, he said.

The central bank and the government have been at loggerheads all year over cryptocurrency regulation. Aksakov said he is hopeful that a law will be passed this year.

He added that the next step for the digital ruble is to launch a joint settlement with China, which has already tried the digital yuan.

“If we start this, other countries will begin to actively use it in the future, and the control of the United States over the international financial system will be successfully ended,” Aksakov said.

Western countries are avoiding Russia, and cooperation with Beijing is becoming more important for Moscow. The two countries have increased trade and Russian companies have started lending in yuan.

Some central bankers have also suggested that the new technologies could allow the countries to communicate directly with each other, making them less dependent on Western-controlled payment channels such as the SWIFT system, which many Russian banks have lost access to due to the ban. .

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