Russian President Vladimir Putin, in an interview, stated that he thinks cryptocurrencies have value but however, thinks it is still too early to talk about cryptocurrencies as a means of exchange for energy resources.
Putin told CNBC at the Russian Energy Week event in Moscow Wednesday that, “I believe that it has value, but I don’t believe it can be used in the oil trade.”
During the interview, when asked whether bitcoin or another cryptocurrency could be used as an alternative to the dollar in trading oil, Putin stated that it’s “too early to talk about the trade of energy resources in crypto.”
He further stated, “Cryptocurrency is not supported by anything as of yet. It may exist as a means of payment, but I think it’s too early to say about the oil trade in cryptocurrency.”
In the interview, Putin pointed out the massive energy needed to maintain a Proof of Work (PoW) network consensus mechanism, which flagship cryptocurrency, bitcoin, operates on, as a potential barrier to their use as a means of exchange for oil trades.
However, Putin didn’t hold back his words on Russia’s attempt to move away from reliance on the dollar for trade. He stated, “I believe the U.S. makes a huge mistake in using the dollar as a sanction instrument. 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. 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,” he added.
Russia has sought alternatives to trading in dollars since being hit with sanctions in 2014, following the annexation of Crimea, hence why Putin accuses the U.S. of using its currency as a weapon.
The Bank of Russia has consistently warned investors that the cryptocurrency market is extremely volatile and digital currencies are not allowed to be used as a method of payment domestically. However, the country will not be following China’s approach as there are no plans for a blanket ban, Deputy Finance Minister Alexei Moiseev said this week, according to Interfax.