Russian President Vladimir Putin gives a speech during Russian Energy Week on October 13, 2021 in Moscow, Russia.
Mikhail Svetlov | Getty Images
Russian President Vladimir Putin believes cryptocurrencies have value – but he is not convinced that they can replace the US dollar when conducting oil deals.
A few months ago, Russia’s Deputy Prime Minister Alexander Novak suggested that the country could move away from dollar-denominated crude oil deals if the US continued to impose targeted economic sanctions.
When asked if Bitcoin or any other cryptocurrency could be used as an alternative to the dollar, Putin said it was “too early to talk about trading energy resources in crypto”.
“I believe it has value,” he told CNBC’s Hadley Gamble at the Russian Energy Week event in Moscow on Wednesday. “But I don’t think it can be used in the oil trade.”
“Nothing supports cryptocurrency yet,” Putin said. “It may exist as a means of payment, but I think it’s too early to say anything about cryptocurrency oil trading.”
The Russian head of state also described the massive energy consumption of cryptocurrencies as a potential obstacle to their use. Bitcoin requires a lot of computing power to process transactions and mint new tokens.
However, Putin did not mince his words about Russia’s attempt to break away from its dependence on the dollar.
“I believe the US is making a big mistake in using the dollar as an instrument of sanction,” he said. “We are forced. We have no choice but to switch to transactions in other currencies.”
“In that regard, we can say that the United States is biting the hand that feeds it,” Putin added. “This dollar is a competitive advantage. It is a universal reserve currency and the United States is using it today to pursue political ends, thereby damaging its strategic and economic interests.”
In June Russia announced that it would remove US dollar investments from its sovereign wealth fund.