Russia Turns to Crypto for Oil Trade with China and India

Russia is now using cryptocurrencies to support its oil trade with China and India, helping the country work around Western sanctions.

According to a recent Reuters report, Russian oil companies have started using Bitcoin, ether, and stablecoins like Tether to help change Chinese yuan and Indian rupees into Russian rubles.

Russia is reportedly using Bitcoin & crypto to trade oil with China and India

This is absolutely massive!

— Lark Davis (@TheCryptoLark) March 14, 2025

Though crypto makes up just a small part of Russia’s overall oil business, which was worth $192 billion last year according to the International Energy Agency, sources say its use is growing. Sources with direct knowledge of these deals shared details with Reuters but asked not to be named because of how sensitive the information is.

How Russia’s Crypto Oil Payments Work

The payment process involves several steps. First, a Chinese buyer pays a middleman company in yuan using an offshore account. Then, the middleman changes this money into cryptocurrency and sends it to another account. Finally, the crypto is sent to a Russian account, where it’s changed into rubles.

For one Russian oil trader working with China, these crypto transactions reach tens of millions of dollars each month. However, most of Russia’s oil deals still use regular currencies, with other workarounds including the use of UAE dirham.

Why Russia Will Keep Using Crypto Even If Sanctions End

Last summer, Russia passed a law to allow digital currency payments in international trade, making its support for crypto official. The Russian central bank hasn’t commented on these specific practices but did mention last year that payment delays caused by sanctions were a major problem for the Russian economy.

What’s interesting is that sources say Russia would likely continue using crypto for oil trading even if sanctions are lifted and the dollar becomes available again. One source explained that crypto is a “convenient tool” that helps make operations faster.

Russia isn’t the first country to use crypto to avoid U.S. sanctions. Iran and Venezuela have already used digital currencies to keep their economies running while avoiding the dollar, which is typically the main currency for global oil market deals.

The crypto system comes after Venezuela stepped up its use of digital currency for crude and fuel exports when Washington put sanctions back in place. According to a researcher at an investigation firm tracking sanctions evasion through cryptocurrencies, “Russia has set up a variety of systems and USDT (Tether) is just one of them.”

With U.S. President Donald Trump considering more sanctions on Russia despite seeking improved relations, Russia’s crypto strategy for oil payments may become even more important in the coming months.