The Islamic Republic of Iran and Russia are partnering to release a gold-backed stablecoin. According to the course, the two countries want to have a stablecoin that will enable trade in the Persian Gulf region, with a focus on Astrakhan, an economic zone that has linked Russia with Iranian cargo shipments.
The commodity-backed stablecoin planned by both countries will also serve as a cross-border legal tender for making payments.
Stablecoins are simply cryptocurrencies (built on the blockchain) with prices pegged to another asset aimed at making it less volatile than the “normal” cryptocurrencies.
The assets can be pegged to include fiat like the dollar for USDT stablecoins, commodities like gold (an example is Paxos Gold stablecoins), or other cryptocurrencies (an example is the Dai stablecoins).
Alexander Brazhnikov, executive director of the Russian Association of Crypto Industry and Blockchain explained per the news that the stablecoin will be backed by gold.
Regulation of the digital market in Russia
In a statement made by Anton Tkachev, a member of the Russian Committee on Information Policy, Information Technology, and Communications, the stablecoin project with Iran will be implemented when there is effective regulation in the digital assets market in Russia.
While Iran and Russia have been hostile to crypto-related assets by banning citizens from using such, they are also showing interest in the potential of cryptocurrencies and other digital assets. In June 2022, Iran highlighted plans to release a CBDC, crypto Rial. This came after its exit from Swift, the global payment platform.
Then in August, Iran also geared into the digital asset market when the country’s Mines and Trade Ministry permitted businesses to use cryptocurrencies for importation into the country due to trade sanctions.
Also, there was an announcement in November for a possible national crypto exchange in Russia. The development was supported by the Ministry of Finance and the Central Bank of Russia.
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