Russia Uses Crypto for Oil Trade with India, China to Bypass Sanctions

In a bid to bypass Western sanctions, Russia is using cryptocurrencies like Bitcoin, Ether, and Tether in oil transactions with China and India, according to a Reuters report. Some Russian oil companies are leveraging digital currencies to convert Chinese yuan and Indian rupees into Russian roubles, making transactions faster and avoiding restrictions imposed by the West.

How Do These Crypto Transactions Work?

According to sources with direct knowledge of the matter:

• A Chinese buyer of Russian oil deposits yuan into an offshore account.
• A middleman trading firm converts this amount into cryptocurrency.
• The crypto is then transferred to another account and converted into roubles in Russia.

One Russian oil trader reportedly processes crypto transactions worth tens of millions of dollars per month.

Russia’s Crypto Strategy Inspired by Other Sanctioned Nations

Other countries like Iran and Venezuela have also used cryptocurrencies to evade U.S. sanctions.

• Venezuela increased its use of digital currency for oil trade after the U.S. reimposed sanctions.
• Russia has developed multiple financial systems, with Tether (USDT) being a key component of its workaround.

Impact on the Global Oil Market

While traditional currencies still dominate Russia’s oil trade, crypto is emerging as a viable alternative.

• The UAE dirham is also being used for Russian oil transactions.
• Some Russian crypto exchanges, like Garantex, have been sanctioned by the U.S. and EU.

Will Crypto Continue in Russian Oil Trade?

Despite the geopolitical uncertainty, sources suggest that Russia will continue using cryptocurrencies even if sanctions are lifted, as it provides a fast and convenient way to process payments.