Russian President Vladimir Putin stated last week that it was “a little early” to utilize cryptocurrency to settle oil transactions. Russia’s Ministry of Foreign Affairs (MFA Russia) is allegedly contemplating replacing the US dollar with not just conventional fiat currencies, but also digital currencies.
In a Tuesday interview with local news agency Interfax, Aleksandr Pankin, Russia’s deputy minister of foreign affairs, reaffirmed the country’s intentions to decrease the dollar’s role in the country’s international reserves and its use in settlements with foreign partners.
According to the source, MFA Russia is not ruling out the idea of replacing the US dollar with “certain digital assets” in addition to other currencies:
“In the long run, it is conceivable to replace the US dollar with other currencies, both national and regional, as well as certain digital assets.”
Pankin noted that such a replacement would need considerable government effort, including reconstructing existing patterns of collaboration between jurisdictions and companies and developing new mechanisms for new settlement systems.
The official added that Russia’s de-dollarization drive is consistent with the country’s attempts to circumvent obstacles presented by US government sanctions.
“Payments made in US currency are routed via American banks and a clearing mechanism that enables Washington to reject any transactions it deems suspicious,” Pankin said. He said that Russia has not encountered such difficulties with the euro or other fiat currencies and has no plans to do so with any other national currencies.
Russia has been exploring measures to reduce the currency component of its $186 billion national welfare fund for many years. Local governments want to significantly expand their holdings of Chinese yuan and invest in gold.
Russia’s apparent interest in utilizing crypto for international resolution is reinforced by the recent comments from the Ministry of Foreign Affairs. Russian President Vladimir Putin said last week that it was “a little premature” to utilize cryptocurrency to settle oil transactions. Additionally, the president acknowledged cryptocurrency’s potential for worldwide money transfers.
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