The Russian State Duma is reportedly planning on reviewing and adopting new cryptocurrency regulation in March. According to a February 21 report from Rambler, the former Energy Minister Igor Yusufov has also proposed launching an oil-backed cryptocurrency.
Yusufov, who is currently the head of the Energia corporation, has tangible prospects for proposing an oil-backed cryptocurrency, as the project’s roadmap is at its final stage, the Russian financial outlet reported.
During an interview with the publication, Yusufov said that introducing a crypto settlement system on the energy market could allow for the avoidance of costs associated with the use of not-backed-up currencies and the fluctuations of their exchange rates. The system he proposes could also enable significant savings to be made on currency exchange commissions and trade restrictions.
A cryptocurrency platform could benefit other companies and countries, too, Yusufov said. The proposed system would enable OPEC+ members to circumnavigate financial and trade restrictions. Every barrel of oil could be tracked and his location verified without any additional costs, he explained.
Igor Kostikov, the former head of the Federal Securities Commission of Russia, shares Yusufov’s views on the project. He, however, believes that such a system could be a precedent for other exchangeable resources being put on a blockchain.
“Perhaps the oil-backed cryptocurrency will be the pioneering project that will create a reliable structure for the cryptographic market as a whole,” he told Rambler.
And while the idea of an oil-backed coin might be great in theory, it’s practical application have shown otherwise. Venezuelan President Nicolas Maduro introduced the country’s own oil-backed cryptocurrency named the Petro back in 2017. Marketed as a solution to the country’s economic crisis, the coin launched in October 2018 to almost exclusively negative reviews. Even Russia, one of Maduro’s rare allies, has refused to accept Petro, saying all attempts to spread the use of the coin were futile.