BRICS to Launch Blockchain Payment System to Reduce Dollar Dependence

• BRICS Pay will help the alliance reduce its dependence on the U.S. single currency in global business transactions.
• Russia plays a key role in developing BRICS Pay and aims to integrate digital money.
• The platform’s launch could particularly shift the global financial landscape and challenge traditional systems.

The BRICS alliance, including Brazil, Russia, India, China, and South Africa, is preparing to introduce an important development in wider finance. The group plans to unveil the BRICS settlement blockchain platform at its October 2024 summit. Announced in March, this platform intended outcomes to reduce reliance on the U.S. dollar for international movements by creating a new system that supports local currencies among BRICS nations.

Importance of the BRICS Pay System

The BRICS Pay platform has been closely watched since its announcement because it uses blockchain technology, which allows secure and efficient cross-border expenditures. This initiative aligns with the alliance’s goal to strengthen economic ties and promote economic independence.

By reducing the dependence on the U.S. dollar, BRICS aims to reshape global financial systems in favour of their collective interests.

Russia’s Role in the Development

Russia has been a driving force behind BRICS Pay. Prominent figures such as Finance Minister Anton Siluanov and Central Bank Governor Elvira Nabiullina have been actively involved in bringing this project to life. Russia’s recent efforts to integrate virtual currency into its finances align with the system’s objectives. 

The country has also announced plans to launch two crypto exchanges and stablecoins linked to the Chinese yuan and other BRICS currencies. These efforts show Russia’s commitment to reducing reliance on the U.S. dollar.

Potential Impact on Global Finance

The expected launch of BRICS Pay could have a crucial impact on wider funding. The United States’s currency’s share of internationally held funds has been decreasing consistently., falling from 72% in 2002 to 58% in 2024. This price drop suggests a shift away from the dollar’s dominance in global trade. BRICS payers could accelerate this conversion by offering a new, efficient fee system as an alternative to traditional networks like SWIFT.

The platform also aims to foster greater economic cooperation among the coalition’s states and endorses the broader goal of creating a more balanced multilateral accounting system. As the October summit approaches, financial experts and policymakers will be watching closely because the launch of the wallet could mark a major change in the nationwide economic scenes.