Buying and Selling Oil Using Crypto: Russia Receives Payments from China and India

Bittime - Russia continues to look for innovative ways to keep its oil trade running amid the pressure of Western economic sanctions. Now, this superpower is starting to accept payments using cryptocurrency from China and India. 

This move not only speeds up transactions, but also allows Russia to circumvent financial restrictions imposed by Western countries. How is Russia selling and buying oil using crypto? Here's the review.

Crypto-Based Russian Oil Transactions

Source: Indiatimes

According to a Reuters report, several Russian oil companies are now using Bitcoin (BTC), Ethereum (ETH), and stablecoins such as Tether (USDT). Then, the crypto asset converts Chinese yuan and Indian rupees to Russian rubles. 

This process allows payments to take place more quickly and efficiently compared to conventional methods which are often hampered by sanctions.

Sources familiar with these transactions say that even if Western sanctions are lifted, it is likely that the use of crypto in oil trading will continue. 

The reason is, this system provides high flexibility and reduces dependence on the US dollar.

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How Does Russia Transaction Oil with Crypto?

The mechanism for Russian oil transactions using crypto involves several steps. First, buyers from China or India pay the intermediary company using yuan or rupees via an offshore account. 

After that, the funds are converted into cryptocurrencies such as USDT or BTC. Next, these digital assets are sent through multiple accounts to avoid detection, before finally being converted back into rubles in Russia.

In recent months, these crypto-based transactions have reportedly reached tens of millions of dollars each month just for sales to China. Although the crypto market share in Russian oil trading is still relatively small compared to traditional payment methods, this trend is expected to continue to grow.

Russia Imitates Iran and Venezuela's Steps

Russia is not the first country to use cryptocurrencies to circumvent economic sanctions. Iran and Venezuela have previously implemented similar strategies in their exports of oil and energy products. 

Venezuela, for example, has increasingly relied on digital assets since US sanctions were tightened again. On the other hand, Iran has used Bitcoin for several trade transactions.

This move by Russia shows that cryptocurrencies are increasingly being recognized as an alternative means of payment amidst global geopolitical and economic uncertainty.

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The Role of Stablecoins in Oil Transactions

One interesting aspect of this payment model is the use of stablecoins such as USDT. Stablecoins offer greater price stability than Bitcoin or Ethereum, which are known to be volatile. 

However, using USDT also carries risks as the issuing company can freeze funds if ordered by regulators, as happened with Russian crypto exchange Garantex, which was hit by US and EU sanctions.

However, Russia appears to remain confident in this system as a long-term solution to overcome the financial obstacles caused by Western sanctions.

The Future of Crypto in Oil Trading

Although Russian oil transactions are still dominated by conventional currencies such as the United Arab Emirates (UAE) yuan and dirham, the use of crypto as a payment method continues to increase. 

With crypto regulations expanding in Russia and the adoption of the digital ruble by the Russian Central Bank, it is likely that the role of digital assets in international trade will become increasingly significant.

FAQ

1. Why does Russia use crypto to buy and sell oil?

Russia uses crypto to evade Western economic sanctions and speed up transactions in oil trade with China and India.

2. What crypto assets are used in this transaction?

Bitcoin (BTC), Ethereum (ETH), and stablecoins such as Tether (USDT) are the main digital assets used in Russian oil transactions.

3. Are oil transactions with crypto legal in Russia?

Yes, Russia has legalized the use of crypto for cross-border transactions since late 2024, allowing oil companies to use digital assets in trading.

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Reference 

Coincident, Russia Uses Crypto in Oil Trade to Evade Western Sanctions, accessed March 15, 2025.

The Crypto Times, Russia uses cryptocurrency to sell oil to China and India, accessed March 15, 2025.

Author: Y