Russian oil firms are using Bitcoin, Ethereum, and stablecoins to convert Chinese yuan and Indian rupees into roubles for trade as Western sanctions persist.

Faced with Western sanctions, Russian oil firms are actively turning to cryptocurrencies to move money between China and India, Reuters has learned citing sources close to the matter.

One of the sources say some Russian oil companies are using Bitcoin (BTC), Ethereum (ETH), and stablecoins like Tether (USDT) to smooth the conversion of Chinese yuan and Indian rupees to Russian roubles. Although more companies are using crypto, it still makes up a small part of Russia’s oil trade, they add.

In one example, a Chinese buyer pays a trading company in yuan into an offshore account. Then, the middleman “converts this into crypto and transfers it to another account and from there, it’s sent to a third account in Russia and converted to roubles,” two sources explained. For one Russian oil trader, “crypto transactions are in the tens of millions of dollars per month,” a source familiar with the trader’s operations said.

Coin Insider Daily previously reported that the Bank of Russia proposed a regulated framework for cryptocurrency investments under a three-year experimental legal regime. The plan would limit participation to “particularly qualified” investors with over 100 million rubles in securities and deposits or an annual income exceeding 50 million rubles.

In May 2024, Bloomberg also reported that Russia’s two largest unsanctioned metal producers began using Tether’s USDT stablecoin for cross-border transactions with Chinese clients and suppliers.

The shift came after the U.S. Treasury had warned it would impose secondary sanctions on financial institutions aiding sanctions evasion. Executives at the unnamed companies explained that some transactions are processed through Hong Kong, although the total trade volume is unclear.