Russia has confirmed that the new BRICS currency will be backed by gold. This groundbreaking news comes on the heels of the currency’s announcement earlier in the year. BRICS is an acronym to represent a consortium of nations including Brazil, Russia, India, China, and South Africa. These nations will work together primarily in areas of trade. In addition to being backed by gold, the BRICS currency will also feature a digital component.
The purpose of this new currency is to circumvent western sanctions placed upon countries like Russia and China. If, for example, Russia is shut out of western financial systems, the BRICS currency will fully operate outside of those boundaries. Usually, when major countries engage in trade with one another, the US dollar is used as sort of a “middle man”currency. Each nation would exchange their own currency for US dollars and execute trade deals in that fashion. With the advent of the BRICS currency, the dollar conversion process will no longer be necessary. A gold backing and crypto component may turn the BRICS currency into a serious, long-term US dollar competitor.
Russia confirms BRICS will create a gold-backed currency | Kitco News
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