Putin Praises Crypto As Possible 'Weaponized' Dollar Replacement

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by Tyler Durden
Thursday, Oct 14, 2021 - 01:55 PM

Update (0920ET): Morgan Stanley CEO James Gorman piled on the mockery of JPMorgan's CEO Jamie Dimon's dismissal of crypto by stating on this morning's earnings call that “We’re not directly trading crypto” for retail clients but:

“I don’t think crypto’s a fad. I don’t think it’s going to go away. I don’t know what the value of Bitcoin should or shouldn’t be. These things aren’t going away.”

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Russian President Vladimir Putin further rattled American financial officials after hinting that while he considers cryptocurrency "crude and under-developed," it could "some day" be used instead of the US dollar to trade with.

The Russian president discussed potential use cases of cryptocurrencies in a Thursday CNBC interview following a plenary session of the ​​Russian Energy Week forum.

"I believe that it has value," Putin told CNBC at the Russian Energy Week event in Moscow on Wednesday, when asked whether bitcoin or cryptocurrencies can be used in place of the US dollar.

"But I don't believe it can be used in the oil trade."

According to the interviews the Kremlin’s official website, Putin said that private cryptocurrencies “can act as a unit of account” but they are “very unstable.”

“Cryptocurrency oil contracts? It’s too early to talk about it. It works for transferring funds from one place to another, but in terms of trading, especially when it comes to energy resources, it is still premature in my opinion,” the president stated.

The Russian government has been closely monitoring the cryptocurrency market, Putin said, adding that he believes it's possible crypto could simply become a “means of accumulation.”

“We see how his market fluctuates. It’s a bit early today."

Right now, cryptocurrencies aren't backed by "anything yet," Putin said. But when asked whether he considers the crypto holdings by Tesla CEO Elon Musk to be “worthless,” Putin said no, explaining that he meant to explore crypto's viability as a unit of account for the energy market.

Later in the interview, Putin reiterated his criticisms about how Washington's abuse of the dollar's dominance is tantamount to brandishing an "economic weapon", and remains keen to ditch dollar-denominated payments.

"I believe the US makes a huge mistake in using the dollar as a sanction instrument," he said.

"We are forced. We have no other choice but to move to transactions in other currencies."

"In this regard, we can say the United States bites the hand that feeds it," the world leader added.

"This dollar is a competitive advantage. It is a universal reserve currency, and the United States today uses it to pursue political goals, and they harm their strategic and economic interests as a result."

"We aren’t interested in cutting off dollar payments completely, and we are so far satisfied with payments for energy resources in dollars, primarily for oil," he added.

Finally, in a distinct break from China, which has worked to suppress crypto mining and trading on its mainland, Putin went on to say that “everything evolves” and “has the right to exist."