Russia Aims to Replace US Dollar Reserves with Digital Assets in Long term

The trade war between Russia and the U.S is not the new thing. The pursuit of global power has seen both of these companies fighting for over decades. However last week the Russian President spoken about the usage of digital currencies. He also talked about the dollar losing its stability and value.

However, the Russian President also talked about the usage of digital tokens to settle oil trades. The Russian President said that it’s too early to introduce in the oil and gas sector.  Russia over the years have strive forward for the de-dollarization. However, the Russian officials have said that they are aiming to replace the U.S dollar with other fiat currencies and the digital currencies as well in the longer period of time.

Aleksandr Pankin, deputy minister of Foreign Affairs of Russia, made it clear that Russia wants to reduce the U.S dollar share in country’s international reserves. The Russian officials have not ruled out the usage of digital currencies in order to replace the U.S dollar.

“It’s possible for country to replace the U.S dollar locally and internationally with other countries, as well as replacing the U.S dollar with the digital assets in future is also pretty much on the cards for Russia.”

Said country’s foreign ministry. Aleksandr Pankin also said that the implementation of such plans would take monumental effort. Russia will need to speak with all of its international strategic partners to support them in this. It would also require the reformation of established cooperation models between jurisdictions and businesses, as well as creating new mechanisms for new settlement systems.

The reason behind Russia considering replacing the U.S dollar with digital currencies it to avoid any sanctions from the U.S government in the future.  One of the biggest concern for Russia is that any payment that involves dollar as the medium of payment, this mean payment would be processed via U.S banking channels. It provides the U.S with the powers to freeze the accounts of any country when payment is in U.S banks. However, the Russian government has not faced any sort issues with Euro and other fiat currencies. These are some of the major concerns of the Russian policy makers. That’s why Russian President and other officials are working on the mechanism to replace the U.S dollar with digital currencies in the longer period of time.

At the moment Russia is working to accommodate the crypto miners and developing crypto friendly policies the reason behind the rapid crypto friendly policies hints at the fact that Russia might move for the option of replacing the U.S dollar with fiat currency in longer run of time.