Visa and Swift Don’t Work in Russia. This Is What They Use Instead

Summary

The video explores the impact of financial sanctions and digital payment systems on global economies. It highlights how Western sanctions, designed to limit access to financial networks, are leading countries to seek alternatives like BRICS Pay, a blockchain-based payment system. This system connects national systems like Russia's MIR and India's RuPay to enable cross-border transactions without relying on the U.S. dollar. The video discusses how electronic money, initially meant to simplify transactions, is now used for control and how countries are considering alternatives to the Western financial system to protect themselves from future sanctions.

Takeaways

• 😀 The global financial system is being reshaped by sanctions, loopholes, and technological advancements.
• 😀 Despite efforts to curb bypassing of sanctions, new loopholes continue to emerge, complicating the effectiveness of financial restrictions.
• 😀 Electronic money transfers and banking, initially designed to foster global cooperation, are now being used as tools for control and restriction.
• 😀 BRICS nations are developing an alternative payment system, BRICS Pay, to facilitate cross-border transactions without relying on the US dollar.
• 😀 BRICS Pay aims to integrate national payment systems like Russia's MIR, India's RuPay, China's UnionPay, and Brazil's ELO to enable smooth payments between countries.
• 😀 The goal of BRICS Pay is to reduce reliance on the US dollar and avoid currency conversion when making international transactions.
• 😀 Countries are increasingly considering alternatives to the Western financial system, not necessarily to replace it, but to have options in case they face sanctions.
• 😀 The rise of blockchain technology plays a central role in the development of decentralized financial systems like BRICS Pay.
• 😀 There’s growing interest in reducing dependency on the US dollar as global financial players anticipate potential future conflicts with Western sanctions.
• 😀 The current situation signals a shift toward a more diversified and multipolar global financial landscape, with countries seeking to secure their economic independence.

Q & A

What major financial impact did Western sanctions have on Russia's ability to use international payment systems?

Western sanctions led to Russia being cut off from major international payment systems like Visa and MasterCard. This made it impossible for foreigners to use these cards in Russia, forcing both locals and visitors to rely on alternative payment methods.

How has Russia responded to the loss of access to international financial networks like SWIFT?

In response to the loss of access to SWIFT, Russia introduced its own domestic payment system called MIR. However, this system has limited international reach, especially for foreign travelers who cannot use it in other countries.

What role has cryptocurrency played in overcoming financial challenges in Russia?

Cryptocurrency, particularly stablecoins like USDT, has played a crucial role in facilitating cross-border transactions. Russians and foreigners alike use cryptocurrency to send money and bypass the restrictions placed by international sanctions and financial institutions.

How are Russian citizens accessing cryptocurrency despite regulatory hurdles?

Russian citizens are often using peer-to-peer (P2P) markets to buy and sell cryptocurrency. These P2P platforms allow them to exchange digital currencies without going through traditional banks or exchange services, which are increasingly restricted.

What are the challenges faced by travelers in Russia when exchanging foreign currencies?

Travelers in Russia face significant challenges when exchanging foreign currencies, as currency exchange offices are very selective about the condition of the bills. Old or damaged USD bills are often rejected, and some travelers are unable to exchange Euros due to European restrictions on bringing currency into Russia.

What is BRICS Pay, and how does it fit into the emerging global financial landscape?

BRICS Pay is a blockchain-based payment system developed by the BRICS nations (Brazil, Russia, India, China, and South Africa). It aims to facilitate cross-border payments between member countries without the need for USD conversion, reducing dependency on Western financial systems and promoting alternative payment methods.

How does BRICS Pay seek to bypass the US dollar in international transactions?

BRICS Pay links national payment systems like Russia's MIR, India's RuPay, China's UnionPay, and Brazil's ELO. This system enables users in these countries to make cross-border payments directly in their national currencies, thus avoiding the need to convert into USD.

Why is the development of alternative financial systems like BRICS Pay becoming more important in today's global economy?

The development of alternative financial systems like BRICS Pay is becoming crucial as countries seek to protect themselves from potential financial isolation, especially during times of conflict or sanctions. These systems provide more resilient options for cross-border transactions and reduce reliance on Western-dominated financial infrastructure.

What unintended consequences have Western sanctions had on the global financial system?

Western sanctions have unintentionally accelerated the move toward alternative financial systems, as countries look to bypass the U.S. dollar and traditional banking networks. This has spurred the development of blockchain technologies, new payment platforms, and decentralized financial solutions.

How do the experiences of American volunteers in Russia highlight the broader issues with international sanctions?

The experiences of American volunteers in Russia underscore the real-world impact of financial sanctions, including the difficulty of transferring money, exchanging currency, and the reliance on workarounds like cryptocurrency. Their struggles emphasize how sanctions can disrupt basic financial transactions and force individuals to adopt new methods to navigate a changing global financial environment.