global trade - Pwim.Net

Russian Finance Ministry on Track to Legalize Crypto for Cross-Border Payments

The current economic landscape in Russia is forcing both the Central Bank and the Ministry of Finance to rethink their approaches to cryptocurrencies.

According to the State-backed TASS News Agency, Deputy Finance Minister,Alexei Moiseev said athatthe Central Bank and the Ministry thave reached an agreement that the use of cryptocurrencies for cross-border payments can no longer be undermined.

“As for the regulation of the cryptocurrency market, the difference in approaches has remained. But I can say that the Central Bank has also rethought [the approach], taking into account the fact that the situation has changed, and we are rethinking it. Because the infrastructure that we plan to create is too rigid for the use of cryptocurrencies in cross-border settlements, which, of course, we must, first of all, legalize somehow. On the one hand, give people the opportunity to do it. On the other hand, put it under control so that there is no laundering, paying for drugs, and so on,” Moiseev said.

Since Russia’s invasion of Ukraine, the former country has been battling a series of sanctions that have crippled its global financial capabilities. In light of these, Russian Prime Minister Mikhail Mishustin hinted at the possibility of using Bitcoin for cross-border transactions.

With Moiseev maintaining a similar stance, it seems obvious that the official legalization of Bitcoin, which was once under the consideration of being banned earlier this year, is just a matter of time.

According to Moiseev, the move to support crypto is to have the opportunity that will aid easy monitoring as crypto native users find a way to either HODL or trade crypto either in or offshore.

“Now people open crypto wallets outside the Russian Federation. It is necessary that this can be done in Russia, that this is done by entities supervised by the Central Bank, which are required to comply with the requirements of anti-money laundering legislation, and first of all, of course, to know their client,” Moiseev said.

Vodafone DAB and Chainlink Labs Unveil Blockchain Solution to Streamline Global Trade

Vodafone’s Digital Asset Broker (DAB) and Chainlink (LINK) Labs have unveiled a proof of concept (PoC) in collaboration with Sumitomo Corporation and InnoWave. This initiative aims to tackle the inefficiencies entrenched in the mammoth $32 trillion global trade arena.

The core of the demonstration lay in the fluid exchange of pivotal trade documents across varied platforms and blockchains, a process often hampered by disjointed systems. The prevalent use of inconsistent paper or digital platforms with subpar interoperability has been a major bottleneck across different sectors in global commerce. By leveraging Chainlink’s Cross-Chain Interoperability Protocol (CCIP) alongside DAB, the companies showcased a solution to ensure security and interoperability across IoT devices at network fringes. This fusion potentially paves the way for a unified interface facilitating secure data and token exchanges across both public and private blockchain networks, alongside IoT networks.

Real-World Application

An illustrative use case presented was a vessel autonomously transmitting data regarding a cargo fire to smart contracts via DAB’s platform and CCIP, potentially activating a marine cargo insurance procedure. This PoC underscores the capability of DAB-enhanced IoT devices and blockchains in delivering secure, trustworthy, and traceable data for smart contract, blockchain, and AI applications.

Trade Document Exchange

Furthering this initiative, the consortium will delve into the feasibility of global trade applications benefiting from DAB’s Economy of Things (EoT) platform. The EoT platform holds promise in empowering devices to autonomously serve as reliable data sources during trade processes, and also leverage DAB’s prowess for enhanced financial transaction processing. During SmartCon 2023 in Barcelona, Spain, a demonstration showcased how trading entities could circumvent unnecessary cargo transit delays by smoothly transferring a digital bill of lading between multiple stakeholders across several blockchains.

Vodafone DAB Joins Chainlink Network

A noteworthy development is Vodafone DAB’s fresh alliance with Chainlink Labs, marking its entry as a Chainlink Network node operator. This positions Vodafone DAB as a key player in facilitating enterprises and businesses to create and deploy smart contracts by ensuring secure and streamlined data exchange and computation. Chainlink’s decentralized oracle networks act as conduits between on-chain smart contracts and off-chain real-world occurrences and data.

The involvement of top-tier entities like Vodafone DAB and Chainlink Labs in devising solutions to longstanding global trade issues showcases the vast potential of blockchain technology. With 3 billion IoT devices projected to transact in the economy of things by 2030, securing consensus and validation between DAB and Chainlink will be pivotal in propelling this growth.

Global Supply Chain Financing: A New Era of Resilience and Diversification

The latest report from Citi, titled “Supply Chain Financing – Building Resilience as the New Definition of ‘Global’ Emerges,” offers a comprehensive insight into the evolving landscape of global trade and supply chains. Published on January 22, 2024, this report marks the fourth edition of the Citi Global Perspectives & Solutions (Citi GPS) series and stands as a testament to the transformative changes in global trade dynamics.

Transformative Technological Innovations and Resilience

Jane Fraser, CEO of Citi, highlights the crucial role of transformative technological innovations in increasing resilience across global supply chains. This focus on resilience is driven by a universal pursuit of security across various domains like food, water, energy, cyber, financial, and operational. The report underscores a significant shift in the reconfiguration of supply chains to meet customer demands and stakeholder expectations. This shift is not only reshaping global trade but is also fostering economic growth.

Adoption of China Plus One Strategy

A notable finding in the report is the adoption of the ‘China Plus One’ strategy by over half of the global respondents, especially in North America. This strategy involves diversifying supply chains by incorporating an additional sourcing destination alongside China, with Vietnam emerging as the preferred alternative. This trend indicates a conscious effort by companies and nations to diversify their supply chain partners, thereby building new trade corridors and enhancing resilience.

Technological Developments in Trade Finance

Chris Cox, Global Head of Trade and Working Capital Solutions at Citi, emphasizes the central role of technology in trade finance. Innovations like artificial intelligence and blockchain are revolutionizing trade finance by enhancing operational efficiency, reducing costs, mitigating fraud, and improving transparency. These advancements are pivotal in improving access to efficient capital globally, especially for small and medium-sized enterprises (SMEs) and companies in emerging markets.

The Evolving Nature of Global Supply Chains

The Citi report delves into the evolution of global supply chains, highlighting the shift towards a new era of diversification. This transformation is evident in various ways:

The emergence of smaller players in global trade, particularly last-mile suppliers in developing countries.

Diversified economies spurred by increased investments in supply chains, as seen in countries like Malaysia, Thailand, Vietnam, Saudi Arabia, and the UAE.

The creation of new trade corridors, exemplified by Brazil’s increased trade with India and China and the Middle East’s stronger connections with Asia.

The report acknowledges that while significant progress has been made, the transformation of supply chains is a gradual process, requiring time to build new relationships and achieve scale.

Challenges and Opportunities Ahead

Despite the easing of supply chain pressures since the peak in 2021, the report acknowledges ongoing challenges such as high inflation, rising interest rates, and geopolitical tensions. However, these challenges also present opportunities for smaller suppliers to engage more actively in global trade. The report advocates for continued collaboration on global solutions, emphasizing the need for standardization, technological integration, and regulatory harmonization to enhance supply chain resilience.