A Russian official recognized that the country could replace its US dollar reserves with cryptocurrencies as its de-dollarization plan advances.
As Russia moves toward de-dollarization as an alternative way to stop sanctions imposed by the United States of America government, some officials are pointing to cryptocurrencies as an alternative way along this path.
Russia’s Deputy Foreign Minister Aleksandr Pankin mentioned digital currencies in a recent interview. In there, he revealed his thoughts about the country’s intentions to reduce the share of the US dollar in deals with foreign partners and Russia’s international reserves. The official shared his statements with the Interfax media.
Pankin said when asked about the Russian government’s plans to deal with economic sanctions and the possible impacts of such restrictions on the local economy that they focus on de-dollarization, import-substitution, and consolidating technological independence.
Russia Could Replace Dollars with Cryptocurrencies
During the interview, Pankin highlighted arguments in favor of de-dollarization, concluding that the adoption could be a feasible option.
On the other hand, the vice-minister assured that the reduction in the influence of the US dollar on the national economy and foreign trade operations contributes to a reduction in the “risks of sanctions” by the United States.
He said that even though this process to reduce dependence on the dollar relates to an increase in the costs of commercial and government financial transactions, it was preferable to the possibility of freezing funds.
The payments in US dollars go through US banks and the clearing system, allowing Washington to block any, in its opinion, suspicious transactions,” he explained.
In this regard, Pankin pointed out the high capacity of digital currencies to set up a reduction in the national reserves of the US dollar.
The deputy minister’s comment could also refer to the sovereign digital currency that Russia is currently developing. However, the representative added that such a replacement would need significant efforts by the government and its relations with other states.
These efforts might include re-building cooperation models established between jurisdictions regarding companies and new mechanisms for new settlement systems.
The Road to de-Dollarization
During the interview, the Russian official also assured that the nation is already setting up trade agreements with other countries to use currencies instead to replace the dollar; Although he did not indicate if this measure included cryptocurrencies such as Bitcoin.
Also, Pankin added that replacing the dollar with another currency is not an end of Russian policies but a defensive reaction and that the government takes to protect the economy.
The Russian government had no intention of applying such tactics to the euro or any other national currency.
Amid US sanctions, Russia has been taking various steps to replace the US dollar. This year, Russia’s Finance Ministry announced that the country’s $ 186 billion sovereign wealth fund was abandoning its dollar holdings to dramatically increase its holdings of Chinese yuan and include gold for the first time.
By: Jenson Nuñez
