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Digital Currency Revolution Series: BRICS Ponders Over Cohesive Payment Network Via Common Cryptocurrency

A members of international association of emerging economies ‘BRICS’ divulged that they are considering the generation of their own new cryptocurrency at a recent summit at the 11th annual BRICS Summit in 2019, which hosted in Brazil.

‘BRICS’ comprised of Brazil, Russia, India, China and South Africa, as per an official in attendance, hinted the idea of developing crypto for an unified payment system amid growing global turbulence, a Russian official said on Thursday.

Russian financial news outlet RBC, also reported yesterday  that the director-general of the Russian Direct Investment Fund (RDIF) Kirill Dmitriev said the BRICS Business Council supported the idea of creating a single payment system for settlements between the member countries.

The member nations of BRICS are reportedly intending to design and develop for a single payment transaction system between the member countries, which could be carried out in a still-to-be-developed “BRICS” cryptocurrency. Dmitriev said: “An efficiently operating BRICS payment system is capable of stimulating settlements in national currencies and ensuring the stability of settlements and investments between our countries, which form more than 20% of the global influx of foreign direct investment.”

“An efficient BRICS payment system can encourage payments in national currencies and ensure sustainable payments and investments among our countries, which make up over 20% of the global inflow of foreign direct investment,” Dmitriev, further added to the reports.

These emerging economies grew less than 20% of the global GDP in last decade or so. India and China are two nations that have been growing significantly, while at the same time, rising commodity prices have boosted the pace of growth in Brazil, Russia and South Africa.

Nevertheless, soon after the hints of global slowdown and the potential financial crisis, external macro factors coupled with domestic factors posing risks and hindering the prospects of this region. Their currency softness against the robust dollar is also a cause of concern. Hence, couple of modern day’s financial veterans reckon that the common currency would be a conducive idea for these emerging economies.

By Niranjan Patil
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