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George Spencer

October 19, 2021

Russia Might Adopt Digital Assets For Foreign Reserves

As the cryptocurrency industry edges closer to a mainstream adoption stage, various countries, including the Russian Federation, are looking to replace the US dollar with “digital assets” in the long run.

In an interview, today with the local media outlet,  Interfax, Russia’s Deputy Minister of Foreign Affairs, Alexander Pankin, noted that the country has continued in its conscious efforts to reduce the influence of the US dollar on its national economy.

The minister noted that the Ministry of Foreign Affairs (MFA Russia) is looking at the possibility of replacing the US dollar with other traditional fiat currencies as well as digital currencies.

“At the same time, it is possible to replace the American dollar with other currencies, both national and regional, and in the future, probably, with some kind of digital assets,” Pankin said.

He added that for this initiative to be possible, the government will play a major role in implementing the policy by setting up cooperation models and putting in place mechanisms for the new development to take effect.

According to the official, the move comes in line with the country’s efforts to put a stop to sanctions imposed by the U.S. government, which it does not experience from other European countries.

He noted that the US government uses its currency as a sanction instrument.

He said:

“Payments in U.S. dollars go through American banks and a clearing system, which allows Washington to block any transactions they deem suspicious,” 

Russia Sees Value in Cryptocurrencies

Russia has been looking to accelerate the de-dollarization move and is considering replacing it with digital assets in the long run. Last week, the country’s president, Vladimir Putin, aired his view in an interview with CNBC that bitcoin and other digital assets could one day be used to settle oil trades.

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The president noted that crypto “has the right to exist and can be used as a means of payment.”

However, he cautioned that due to its extremely volatile nature, it cannot replace the U.S. dollar in settling oil and other energy trades as of yet.

While Russia is yet to make a clear stand on cryptocurrencies, El Salvador, the first and only country to legalize bitcoin, is already making plans to build a vet with the profits from its bitcoin investment.