BRICS is curbing the influence of the US dollar with a blockchain-based payment system.

BRICS, a global intergovernmental organization, is preparing to launch a cross-border payment system based on the concept of digital currency and blockchain technology.

The group is seeking an alternative to the U.S. dollar as the de facto currency for international trade. BRICS, comprised of Brazil, Russia, India, China and South Africa, is examining several options to reduce dependence on the dollar for payments.

Among possible options, the economic union is expected to pursue a blockchain-based payment system that uses digital currency as the main payment currency.

“We believe that creating an independent BRICS payment system is an important goal for the future, which will be based on digital technologies and cutting-edge tools such as blockchain,” said official Yury Ushakov.

Although the report did not delve into the inner workings of the payments system, there is widespread speculation that the system will rely on central bank digital currencies (CBDCs) to facilitate transactions.

Several BRICS member countries are actively pursuing retail and wholesale CBDCs, with China leading the way with advanced testing of a digital yuan. India’s experiment involved major commercial banks and concluded high-profile bilateral agreements, while Brazil’s CBDC pilot recorded success.

There are also rumors that the BRICS system may switch to stablecoins for payments as part of its de-dollarization efforts. Russia has previously been exploring stablecoins for cross-border transactions and may pursue their use during his term as BRICS chairman.

“The most important thing is to ensure that it is convenient, cost-effective and free of political problems for the government, the public and businesses,” Ushakov said.

Alongside the blockchain-based payment system is the ambitious Contingency Reserve Agreement (CRA), designed to force member countries to use their local currencies instead of the U.S. dollar to “protect against global liquidity pressures.”

Sanctions could spur new drives.

After Russia began its invasion of Ukraine in 2022, Western powers enforced economic sanctions against the superpower, shrinking its economy by nearly 5%.

To circumvent sanctions, Russian authorities have targeted digital currencies as a viable alternative, but the exit of centralized exchanges from the country has disrupted the country’s situation.

In early March, Russian Finance Minister Anton Siluanov unveiled plans for the BRICS Bridge System for international settlements, designed to counter Western economic powers.

“This change is not simple. We are seeing what restrictions and sanctions are being tried to curb China and Russia, and this is the result of a paradigm shift,” Siluanov said.

Watch: Blockchain is the most secure way to make payments.

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