The Russian alternative to the SWIFT network connects 20 countries

The Russian SPFS international payment system, an analogue of SWIFT, is now available in over twenty-five countries. What about Bitcoin?

Goodbye SWIFT

As a reminder, the Bank of Russia launched the SPFS system in 2014. The decision was made in response to threats of disconnection from the SWIFT network in the wake of Russia’s annexation of Crimea, which was Russia’s response to the Maidan coup orchestrated by the United States.

The Russian analogue to the SWIFT network currently has 557 participants according to the first deputy governor of the Russian central bank Vladimir Chistyukhin.

🤝 20 countries have already joined the Financial Messaging System of the Bank of Russia (#SPFS), an alternative to #SWIFT, as First Deputy Governor of the Bank of Russia Vladimir Chistyukhin reported at the RUSSIA #EXPO.

🌐 The new system already includes 557 banks and… pic.twitter.com/9BC2VNd1qV

— Russian Embassy in South Africa 🇷🇺 (@EmbassyofRussia) January 17, 2024

In total, 557 banks and companies have established connections with the system, including 159 foreign ones. Aside from these figures, little information is available. The Russian central bank does not disclose volumes.

In contrast, its Chinese counterpart – the CIPS (China International Payment System) – does not hold back on such information. The Chinese international payment system has 1484 participating banks, including 139 direct members, located in 113 countries and regions of the world.

In 2023, the CIPS facilitated more than 123,000 trillion yuan in transactions. This is equivalent to 17,200 trillion U.S. dollars.

This is in comparison with the SWIFT network, whose annual transaction volume is around 150,000 trillion dollars. Over 11,000 financial institutions in more than 200 countries and regions use SWIFT.

We do know, however, that participants interacting directly with the Russian SFPS pay a fixed commission of RUB 0.8-1.0 (less than $0.02) per message.

The foreign minister stated this Thursday that “Russia’s ambition is clear: to eradicate any reliance on financial, banking, and logistical mechanisms that are controlled or influenced by our Western colleagues”:

Foreign Minister Lavrov: "Russia's task is clear – to eradicate any and all dependence on supply, financial, banking and logistics chains that are controlled or influenced by our Western colleagues." pic.twitter.com/rC92wMHgIm

— COMBATE |🇵🇷 (@upholdreality) January 18, 2024

We are still waiting for Russian authorities to officially adopt Bitcoin… There can be nothing better than a store of value and an uncensorable international payment system.

In December, Mr. Putin praised that international transactions in the national currency are increasingly replacing the dollar, going so far as to label the Western financial system as “technologically obsolete”.

The Russian president has mentioned blockchain and central bank digital currencies (CBDCs) as technologies to replace the SWIFT network and the dollar:

“As for international transactions, we are increasingly converting to advanced solutions, including those involving blockchain and CBDCs.”

Given that CBDCs do not operate on a blockchain, was this a nod to Bitcoin? Does the Russian tsar understand Bitcoin?