Central Bank Digital Currencies as an Instrument for International Settlements and a Way to Mitigate Sanctions Impacts

Abstract

Due to the rapid development of digital payment instruments and their introduction into the daily routine, the question of the possibility and expediency of using digital financial assets as one of the means of payment in global trade has become urgent. Currently, many countries are already developing or even testing mechanisms for internal settlements in Central Bank Digital Currencies (CBDC). The changes caused by the events in 2022 and attempts to isolate the Russian Federation from the global financial system have given new impetus to the discussion by a number of countries on the issue of switching to settlements in national currencies in international trade. The designing and deployment of a new mechanism for processing cross-border payments based on the use of a CBDC, is one of the possible ways to implement the discussed transition.