Illustrative image of two commemorative bitcoins seen in front of the national flag of Russia displayed on a computer screen.
Artur Widak | Nurphoto | Getty Images
Russian lawmakers on Tuesday approved a new law permitting the use of cryptocurrency for international payments, as the country faces ongoing financial pressure from Western sanctions.
The State Duma, which is the lower house of the Russian Parliament, on Tuesday gave the initial greenlight to the new legislation, which would allow businesses to use cryptocurrencies for cross-border trade, local media reported.
“We are taking a historic decision in the financial sphere,” Anatoly Aksakov, the head of the Duma, told lawmakers Tuesday, according to reporting from news agency Reuters.
Mati Greenspan, CEO of crypto market research firm Quantum Economics, said Russia warming to crypto made sense as bitcoin transactions “cannot be censored or blocked by any government or bank,.”
“Previously, Russia would not want to allow that kind of transactional freedom to its citizens — but now we’re at the point that bitcoin is used so often in every day commerce that the opportunity cost for them not to allow it is simply too great,” he added.
Bitcoin prices have more than doubled in the past year amid optimism over the approval of the first U.S. spot bitcoin — and, more recently, ether — exchange-traded funds, as well as the so-called halving event which reduces the supply of newly issued tokens.
The world’s largest digital currency is currently worth $66,000, according to CoinGecko data, up over 120% in the last 12 months.
Under pressure from sanctions
Growing tensions between Russia and the U.S. and its allies have led to innumerable sanctions on individuals and entities in Russia in retaliation to its assault on Ukraine.
The U.S., European Union and Britain are among the jurisdictions that imposed sanctions on Russia after its February 2022 invasion of Ukraine. They’ve continued to amp up pressure on the country, targeting President Vladimir Putin, Russia’s financial sector, and countless oligarchs.
In addition to passing legislation allowing Russian firms the ability to transact internationally via crypto, the Russian central bank will also be given permission to move money overseas using private digital currencies.
Elvira Nabiullina, the Russian central bank governor, said Tuesday that crypto-based payments would begin taking place before the end of 2024.
“We are already discussing the terms of the experiment with ministries and departments, with businesses, and we expect that the first such payments will take place before the end of this year,” she said.
The central bank’s commitment to use crypto as a method of cross-border payment marks a reversal from the regulator’s previous stance on the technology.
In January 2022, the Russian central bank proposed banning the use of crypto for transactions, as well as the mining of digital currencies, citing threats to financial stability, citizens’ wellbeing and monetary policy sovereignty.
Separately, Russia is also exploring the implementation of a digital version of the ruble. Central Bank Governor Nabiullina said Tuesday that the regulator will look to move away from a pilot phase toward mass implementation of the digital ruble from July 2025, Russian news agency Interfax reported.
Central bank digital currencies, or CBDCs, are different from crypto. Unlike bitcoin and other cryptocurrencies, which have no central authority governing them, CBDCs are issued by directly by a government and are designed to replicate fiat currencies in the form of a digital token.
Can crypto help countries evade sanctions?
Quantum Economics’ Greenspan said that Russia’s move to accept crypto “makes total sense from a global trade perspective.”
This will, he added, “help the Russians open up cross border payments with countries and businesses that would otherwise be closed to them due to U.S. sanctions.”
Other sanctioned countries have frequently attempted to circumvent such financial curbs through the use of cryptocurrencies. North Korea, for example, has on multiple occasions been accused of raising millions of dollars in crypto to help fund various state programs and evade foreign sanctions.
North Korean state-backed hacking group Lazarus was behind a huge heist on the Ronin Network — a blockchain that supports a popular nonfungible token (NFT) game called Axie Infinity. The hack saw cybercriminals make off with over $600 million worth of digital tokens, blockchain analysis firms Elliptic and Chainalysis have said previously.
Proponents of cryptocurrencies, on the other hand, also claim that the digital assets are a useful tool for countering illicit activities. That’s because the networks that underpin them, called blockchains, are public and show a historical record of transactions that is cryptographically secure and can’t be altered.
LONDON — Britain on Tuesday published draft legislation for the cryptocurrency industry, touting greater collaboration with the U.S. as it looks to regulate the wild world of digital assets.
Speaking at a fintech event Tuesday, U.K. Finance Minister Rachel Reeves announced plans for a “comprehensive regulatory regime for crypto assets,” adding that the proposals would aim to make the country a “world leader in digital assets.”
The rules will bring crypto exchanges, dealers and agents into the regulatory fold, “cracking down on bad actors while supporting legitimate innovation,” the U.K.’s Treasury department said in a statement released following Reeves’ remarks.
“Crypto firms with UK customers will also have to meet clear standards on transparency, consumer protection, and operational resilience — just like firms in traditional finance,” the Treasury’s statement added.
Reeves said that the U.K. planned to deepen regulatory cooperation with the U.S. to boost “responsible” adoption of digital assets. “For the U.K. to be a world leader in digital assets, international cooperation is vital,” she told attendees at fintech industry group Innovate Finance’s annual summit.
The U.K. finance minister met with her U.S. counterpart Scott Bessent last week to discuss a trade deal. She had previously said that improving business ties with the European Union was “arguably even more important.”
“Regulation must support business, not hold it back,” Reeves said Thursday.
Crypto industry insiders say the Financial Conduct Authority — which is the U.K.’s financial services watchdog — has been too restrictive when it comes to approving registrations from digital asset firms.
The FCA is the regulator responsible for registering firms that want to provide crypto services within the scope of money laundering regulations in the U.K.
Treasury Secretary Scott Bessent said Tuesday that individual investors, who have largely been holding their positions through the recent market turmoil, have faith in President Donald Trump’s tariff policy.
“Individual investors have held tight, while institutional investors have panicked … individual investors trust President Trump,” Bessent said during a press briefing alongside White House press secretary Karoline Leavitt.
“Vanguard, one of the largest money management firms in America, said that over the past 100 days, 97% of Americans haven’t done a trade,” Bessent, a former hedge fund CEO, said, citing a Washington Post story with the data.
Trump’s rollout and subsequent suspension of the highest tariffs on imports in generations, fueled the worst sell-off in stocks since the onset of the pandemic in 2020. The S&P 500 briefly tumbled into a bear market before recouping some of the losses, and the equity benchmark is now about 10% off its February all-time high.
During the depth of the April rout, retail investors swooped in to snap up stocks at depressed values. At the same time, hedge funds and professional traders ran for the exit while piling on bearish wagers against the market.
Institutions have grown increasingly worried that steep tariffs will weigh heavily on consumers and slow down the economy, possibly tipping it into a recession.
Check out the companies making headlines in premarket trading. Spotify — The music streaming stock tumbled 5% after reporting first-quarter operating income of 509 million euros, while analysts polled by FactSet had penciled in 519.9 million euros. Spotify’s 4.2 billion euro revenue was in line with estimates, while its monthly active users of 678 million was in line with prior guidance. General Motors — Stock in the U.S. automaker slipped about 2% before the opening bell. General Motors surpassed Wall Street’s first-quarter estimates on the top and bottom line, but said it would reassess its full-year outlook due to President Donald Trump’s tariffs and broader macroeconomic uncertainty. The company also said it would suspend additional stock buybacks. Hims & Hers Health — Stock in the telehealth company surged more than 39% following news that Novo Nordisk plans to offer its weight loss drug Wegovy through Hims’ platform, as well as Ro and Life MD. Royal Caribbean — The cruise operator popped 5.4% after posting a first-quarter earnings beat and raising its full-year guidance. Royal Caribbean now expects full-year adjusted earnings between $14.55 to $15.55 per share, up from its previous guidance of $14.35 to $14.65 a share. Analysts polled by FactSet were expecting guidance of $14.94 per share. The company said it had record bookings during WAVE season Deutsche Bank — Shares of the German lender advanced 3% after reporting a 39% jump in profit in the first quarter, as well as a 10% gain in net revenue for the company’s investment banking segment. Regeneron — The biotech stock dropped 7.5% after first-quarter results missed estimates on the top and bottom lines. Regeneron reported $8.22 in adjusted earnings per share on $3.03 billion in revenue. Analysts surveyed by FactSet had penciled in $8.62 per share and $3.25 billion in revenue. Regeneron also lowered its full-year guidance for gross margin. SoFi Technologies — Shares of the digital financial services company jumped nearly 6% on the back of strong first-quarter results. SoFi reported adjusted net revenue of $770.7 million, while analysts polled by FactSet had expected $739.0 million for the period. Adjusted EBITDA came out at $210.3 million, significantly higher than the $177.5 million expected by analysts. Coca-Cola — Shares rose 1% after the beverage giant posted first-quarter adjusted earnings of 73 cents per share , beating the LSEG consensus estimate of 71 cents. Coca-Cola reported adjusted revenue of $11.22 billion, exceeding the expected $11.14 billion. The company also reaffirmed its full-year outlook, saying the effects of global trade conflicts should be “manageable.” Waste Management — Shares of the waste collection and disposal company dropped 2% after first-quarter revenue came in lighter than expected. Waste Management reported $6.02 billion in revenue, below the $6.11 billion projected by analysts polled by FactSet. Pfizer — The drug maker’s shares dipped more than 1% after the firm expanded its cost-cutting efforts and reported first-quarter profit that topped estimates. Pfizer’s sales fell, however, largely due to dwindling Covid revenue. Pfizer maintained its 2025 guidance but noted it’s unable to predict the impact from tariffs at this time. Honeywell International — The manufacturing and technology stock climbed nearly 4% after better-than-expected first-quarter results. Honeywell reported earnings per share of $2.51, excluding items, on revenue of $9.82 billion. Analysts polled by FactSet forecast $2.21 per share and $9.59 billion in revenue. BP — Shares of the British oil behemoth slipped 3.4% on the heels of weaker-than-expected net profit in the first quarter , amid a broader strategic reset for the company. BP reported net profit of $1.38 in the first quarter, while analysts polled by LSEG were looking for $1.6 billion. NXP Semiconductors NV — The chip stock pulled back nearly 8% even as the company surpassed expectations on the top and bottom lines in the first quarter, while NXP announced that Rafael Sotomayor will replace Kurt Sievers as CEO. The low end of NXP’s second-quarter earnings outlook did miss consensus estimates from analysts polled by FactSet, as did the bottom end of its revenue forecast. United Parcel Service — The stock rose nearly 2% after the delivery giant reported first-quarter earnings of $1.49 per share, topping the $1.38 expected from analysts polled by LSEG. Revenue also beat expectations, coming in at $21.5 billion, versus the $21.05 billion consensus estimate. In addition, UPS said it will slash 20,000 jobs to control costs. Leggett & Platt — Shares gained more than 15% after the bedding products company reiterated its full-year outlook. Executives said the company should see a net benefit from President Donald Trump’s tariff plans, but cautioned that the duties could hit consumer confidence and discretionary demand, while also stoking inflation. Sherwin-Williams — Shares leaped 5% after the paint and coatings company reported first-quarter earnings that topped estimates, and reaffirmed its full year guidance. Sherwin-Williams posted adjusted earnings of $2.25 per share, more than the FactSet consensus estimate of $2.15 earnings per share. On the other hand, revenue of $5.31 billion fell below the anticipated $5.40 billion. — CNBC’s Lisa Han, Pia Singh, Jesse Pound, Sarah Min, Yun Li and Michelle Fox contributed reporting.