Russia’s president Vladimir Putin has warned the Biden administration is “killing [the dollar] with its own hands” by turning the currency into a weapon of foreign policy in his closely-watched interview with former Fox News host Tucker Carlson.
Putin called it “one of the biggest strategic mistakes made by the White House,” in the wide-ranging 2-hour conversation that covered Russia’s invasion of Ukraine and the future of artificial intelligence (just a week after U.S. president Joe Biden’s administration declared a crypto “emergency”).
After the 2022 bitcoin price crash, the cryptocurrency has roared back, fueling bets among its biggest supporters that it’s “bitcoin vs. the U.S. dollar.”
Bitcoin’s historical halving that’s expected to cause crypto price chaos is just around the corner! Sign up now for the free CryptoCodex—A daily newsletter for traders, investors and the crypto-curious that will keep you ahead of the market
“Even the U.S. allies are downsizing the dollar in their reserves,” Putin said in comments translated to English from Russian.
“The dollar is the cornerstone of U.S. power. It is the main weapon used by the U.S. to preserve its power across the world. As soon as the political leadership decided to use the dollar as a tool of political struggle, a blow was dealt to this American power.”
Following Russia’s invasion of Ukraine, Russia was heavily sanctioned by Western powers, kicked off the world’s main international payments network Swift and went on to sign a deal with Iran to trade in their local currencies instead of the U.S. dollar.
“Look where the sanctions have brought us to, until 2022, nearly 80% of foreign transactions in Russia were settled in U.S. dollars or euros. Currently, it is now down to 13%,” Putin said. “Our transactions in [China’s] yuan were 3% before 2022 but are now 34% today. Payments in [Russia’s] rubles have also shot up.”
Sign up now for CryptoCodex—A free, daily newsletter for the crypto-curious
Putin’s warning comes at a time of increased scrutiny of the dollar’s position as the world’s reserve currency, in large part due to the U.S.’s ballooning $34 trillion U.S. debt pile, which Federal Reserve chair Jerome Powell last week warned was “unsustainable.”
The U.S. dollar is “finished as the world’s reserve currency,” analyst Richard X Bove told the New York Times just days after his retirement from a storied 54-year career as a Wall Street analyst.
The huge increase in the supply of U.S. dollars and U.S. debt through the Covid pandemic and lockdowns has galvanized bitcoin supporters who fear the collapse of the U.S. dollar is imminent.
“Over the last ten years, all fiat has declined against the dollar, even as the dollar has collapsed against bitcoin,” tech investor and former Coinbase chief technology investor Balaji Srinivasan posted to X.
“Biden vs Trump is the American election. BitcoinBTC vs dollar is the internet election. Which is truly more important? The election doesn’t matter as much if they lose the printer. Just one or two more orders of magnitude, and that will be clear.”
Follow me on Twitter.
