Digital Currencies Will Not Sway U.S Sanctions: Treasury Official

Digital Currencies Will Not Sway U.S Sanctions - Treasury Official

The US Deputy Treasury Secretary Wally Adeyemo said central bank digital currencies (CBDCs) such as Russia’s digital ruble pose no threat to US sanctions, and due to the world economy being “interconnected,” Russia’s digital ruble will not help the country dodge US sanctions,

Despite the growing popularity of cryptocurrencies, Adeyemo stated in a CNBC interview that the US dollar “will remain the dominant currency in the world.” Digital assets present “potential in many ways” for the US economy, but they also come with a slew of problems, including money laundering. There are, however, ways to overcome this to reap the benefits of the expanding sector,” he noted.

“We believe that by working together with countries throughout the world, we can eventually eliminate this danger by requiring developers of digital assets to adhere to more stringent anti-money laundering rules.”

Adeyemo also said that the use of digital currencies by global central banks poses no risk of penalties from the United States. “We believe that even if a digital ruble or other digital currencies are introduced, our sanctions will still have an impact on their economies since the world economy remains interconnected,” he said.

He went on to note that Russian companies do a lot of business around the world, with a lot of it done in dollars with American financial institutions because “the American economy remains the world’s largest economy. As long as that is the case, and as long as we make the necessary investments, we will be able to use our sanctions regime to ensure that we prevent the very thing that it was designed to prevent”.

Adeyemo’s comments came after Oleg Deripaska, a sanctioned Russian oligarch, called on the Russian government to use Bitcoin (BTC) as a weapon to escape US sanctions and weaken the currency. He stated last month that “the United States has long ago grasped that unregulated digital payments are capable of not only nullifying the effectiveness of the entire mechanism of economic sanctions but also bringing the dollar down as a whole.”

In October, Russia’s deputy foreign minister reaffirmed Russia’s plans to lower the dollar’s proportion of the country’s overseas reserves as part of the country’s strategy to avoid the problems created by US sanctions.

In recent years, the United States has placed sanctions on Russia for a variety of reasons, including suspected poisoning of opposition politicians, electoral involvement, and cyberattacks.

The Author

Ajisebutu Doyinsola

Doyinsola Ajisebutu is a journalist and prolific writer who takes a special interest in Finance, Insurance, and the Tech world.