A leading Russian economist has claimed that Moscow’s crypto adoption may have played a key role in “stabilizing” the ruble in “recent months.”
The claims came from National Research University Higher School of Economics (HSE) Professor Oleg Vyugin, the Russian newspaper RIA Novosti reported on April 13.
Russian Economist: Crypto May Be Driving De-dollarization
Vyugin, the former head of the Russian Federal Financial Markets Service and the ex-Chairman of the Moscow Exchange, was speaking at a conference on investments and trading.
The Professor said that a “possible” rise in “foreign trade settlements” made by “Russian companies in cryptocurrency” could have helped stabilize the RUB.
Vyugin explained that crypto deals make no use of “hard currencies.” That could be one reason why the demand for USD and other fiats was dropping, he remarked. The economist said:
“We need to take settlement factors. into account. For example, we have information that Russia uses cryptocurrency in settlements […] with China. That is, this means that there is no demand for dollars. The dollar is not needed to carry out these settlements.”
He remarked that while settlements remained “very difficult” to process, it was hard to see “what the point of [the] dollar” was in such trade deals. Vyugin added:
“Using alternative forms of payment can reduce demand for hard currencies, and it is possible that this factor is also at play.”
Yuan and USD Demand Falling?
The Russian economist conceded that his claims amounted to “an assumption.” But he also suggested that crypto adoption may also be impacting the demand for other fiats. These include the Chinese yuan, Vyugin said.
The newspaper noted that the yuan exchange rate on the Moscow Exchange has” been steadily declining for several months.”
The exchange’s data shows that yuan prices have fallen by 22.4% from their closing levels in November last year. At that point, they stood at 14.5 rubles ($0.17).
At the end of trading on Friday April 11, the Chinese currency was officially trading for around 11.25 rubles ($0.14) in Moscow.
The newspaper also noted that the official dollar exchange rate, as set by the Russian Central Bank, has also fallen from RUB 109.58 (currently $1.32) to 84 rubles in the same period.
This represents a 23.3% drop since the end of November last year.
Central Bank Still Opposes Use of Crypto
Russian lawmakers have become more vocal in their demands to allow companies more freedom to conduct crypto-powered cross-border trades.
The Central Bank, meanwhile, remains vehemently opposed to crypto adoption. It wants to restrict companies to trading within the confines of its official crypto pay sandbox.
But a growing chorus of domestic companies – including a major logistics player – have asked Moscow to roll out legal framework that would allow more firms to use crypto as a settlement tool for international trade.
Observers think that Russian firms first began using crypto in earnest in response to the US, UK, and EU-led sanctions packages first launched after the outbreak of war in Ukraine in February 2022.
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