New York, Monday, August 12, 2024-El Salvador has proposed using cryptocurrency for trade with the BRICS alliance, aiming to reduce its reliance on the U.S. dollar, which is the Central American country’s official currency. The proposal follows Russia’s recent legislation allowing the use of cryptocurrencies for international trade, a move designed to bypass Western sanctions.
Meanwhile, EL Salvador is engaging with the IMF regarding the currect economic crisis it is undergoiung. See separate story here.
A Russian diplomat said the adoption of cryptocurrencies could streamline trade between El Salvador and BRICS nations, a group comprising Brazil, Russia, India, China, and South Africa.
The diplomat has been quoted as saying there are difficulties in settlements between our countries since the dollar is the official currency in El Salvador.
BRICS has been actively working to decrease the dominance of the U.S. dollar in global trade, seeking to switch to the use of its own currencies.
The idea comes as the BRICS nations have been making moves towards de-dollarization, with Russia’s legalization of crypto trade seen as a significant development.
El Salvador, known for its early adoption of Bitcoin as legal tender, is exploring this move despite facing pressure from Western countries.
The Russian diplomat also claimed that El Salvador was considering joining BRICS, though no formal application has been made yet.
The two countries have seen growing trade relations, with their trade volume increasing from $4 million in 2018 to $20 million in 2020.
