Iran and Russia have switched to using their own currencies for trade, advancing the BRICS strategy to reduce the dollar's global dominance during sanctions.
Iran and Russia have decided to trade in their own currencies rather than the dollar, a change that reflects a broader strategy within the BRICS bloc to reduce global trade's reliance on the greenback.
Details of the Iran-Russia deal
The decision is part of the BRICS group’s focus on de-dollarization, a key initiative in its expansion plans. Iran and Russia’s moves to switch to local currencies in bilateral trade fit with the EU’s broader strategy.
The shift allows the two countries, which are under U.S. sanctions, to more effectively promote trade. The agreement, which was put into effect by the central bank governors of both countries, also complements their growing economic and military cooperation.
BRICS Expansion and Global Monetary Dynamics
Iran’s inclusion in the BRICS expansion plan along with Saudi Arabia, the UAE, Egypt and Ethiopia marks a major expansion of the BRICS bloc. The development, which will be formally implemented next year, could have far-reaching implications for global currency dynamics.
Former U.S. President Donald Trump expressed concerns about the declining influence of the U.S. dollar in an interview. He stressed the potential global shift to alternative currencies and emphasized China's interest in positioning the yuan as more dominant.
Bitcoin as a potential alternative
Amid these developments, discussion is growing around the role of Bitcoin in the global economy. As countries such as Iran and Russia seek alternatives to the traditional financial system, cryptocurrencies such as Bitcoin are emerging as potential tools to circumvent economic sanctions and the limitations of traditional banking.
Bitcoin’s decentralized nature makes it an attractive option for countries looking to reduce their reliance on traditional reserve currencies such as the U.S. dollar. Its increasing adoption and integration into mainstream financial platforms further enhances its potential as an alternative in global trade and reserve currency discussions.
Impact on the US dollar and global trade
The BRICS moves, especially if Saudi Arabia joins and chooses to settle oil trade in currencies other than the U.S. dollar, could seriously affect the role of the U.S. dollar in global trade. This trend supports Trump's warnings about challenges to the dollar's dominance. With the BRICS summit approaching, these developments suggest that efforts to de-dollarize may accelerate, potentially reshaping the international trade and financial landscape. #金砖国家 #去美元化
