The BRICS nations are actively collaborating to strengthen emerging economies, aiming to counterbalance the political and financial dominance of developed Western powers. As part of their efforts to deepen ties and enhance economic cooperation, BRICS has revealed plans for a payment system based on blockchain technology, aiming to decrease reliance on the US dollar (USD). BRICS Nations Elevate Blockchain Strategy Perhaps most notably, BRICS nations are developing a blockchain-driven payment system to lessen the use of the dollar among member countries. Kremlin aide Yury Ushakov explained that the payment system will utilize digital blockchain technologies to facilitate cost-effective and politically neutral transactions for governments and individuals alike. According to Ushakov, the blockchain-based payment network seeks to amplify the influence of BRICS nations in the global financial landscape by increasing settlements in national currencies and fortifying correspondent banking networks, thus diversifying international transactions. Specifics regarding the payment system, such as whether BRICS will develop its blockchain or leverage an existing platform, were not disclosed by the Kremlin. The blockchain-based platform represents a natural progression of the BRICS Contingent Reserve Arrangement (CRA), which was established to provide liquidity and support for balancing payments among member countries. The Contingent Reserve Arrangement The CRA was instituted in 2014 during the sixth BRICS summit in Fortaleza, Brazil, with the aim of facilitating payments between member countries and mitigating global liquidity pressures. Member countries collectively committed $100 billion to the CRA, with contributions ranging to $5 billion by South Africa. While bolstering the global financial safety net, the CRA aims to reduce reliance on US dollar-denominated assets and institutions such as the IMF, which are influenced by Western powers. Earlier on in the year, Egypt, Ethiopia, Iran, Saudi Arabia, and the United Arab Emirates joined BRICS. Traditionally comprising emerging market countries, BRICS now includes the high-income developed country, the UAE. Now, member countries are deliberating on the possibility of adopting a single common currency for BRICS. With increasing skepticism toward fiat currency, the rise of BRICS reflects a deliberate response to the collective desire for change.
