Russia considers selling its oil and gas for bitcoin

Russia is exploring accepting bitcoin as payment for its oil and gas exports in the face of increasing sanctions from Western countries over its invasion of Ukraine.

The chairman of Russia's Duma Committee on energy stated in interpreted remarks at a recorded press conference on Thursday that when it comes to friendly countries like China or Turkey, Russia is open to being more liberal with payment arrangements.

The buyer's national fiat currency, as well as bitcoin, are being considered as alternate means to pay for Russia's energy exports, according to the Chairman, Pavel Zavalny.

In translated comments, Zavalny stated, “We have been proposing to China for a long time to switch to settlements in national currencies for rubles and yuan.” He added that with Turkey it will be lira and rubles.

He stated, “You can also trade bitcoins.”

Bitcoin has risen about 4% in the last 24 hours to around $44,000. Around the time when news of Zavalny's words first broke, the price of the cryptocurrency jumped.

President Vladimir Putin promised on Wednesday that unfriendly countries will have to pay for gas in Russian rubles, which the energy chairman backed up. 

Putin's statement sent European gas prices skyrocketing on fears that the measure will aggravate an already strained energy sector.

In remarks that reflected the president's statement from the day before, Zavalny stated, “If they want to buy, let them pay either in hard currency, and this is gold for us, or pay as it is convenient for us, this is the national currency.”

Despite the United States' restriction on Russian oil imports in reaction to Moscow's assault on Ukraine, sources tell CNBC that the European Union is unlikely to follow suit, given its substantial reliance on Russian energy, which is used to heat houses during the winter months.

Nic Carter, the co-founder of Coin Metrics, stated, “Russia is clearly looking to diversify into other currencies.” He revealed that Russia had been planning for such a shift since 2014 when it began to liquidate all of its US Treasury bonds.

Carter, who is also a founding partner of Castle Island Ventures, a cryptocurrency-focused early-stage firm, said the country wasn't entirely prepared for the freezing of foreign FX assets.

Russia now appears to be committed to dumping the dollar.

According to Carter, “They have something the world needs.” Adding that “Russia is the No. 1 exporter of natural gas globally.”

Russia's energy reserves may be converted into tangible assets that could be utilized outside of the dollar system.

Putin's stance on bitcoin has shifted. In 2021, Russian President Vladimir Putin told CNBC's Hadley Gamble that while he believes bitcoin has worth, he isn't persuaded it can replace the US dollar in oil trade settlements.

But now it is being considered as a payment method for large exports. However, it's uncertain whether bitcoin's relative lack of liquidity could sustain such large-scale international commercial operations.