Russia Considers Returning to Dollar Settlement to Win U.S. Economic Cooperation and Ukraine Peace
A leaked Kremlin memo reported by Bloomberg indicates Russia is considering reversing its post-2022 ’de-dollarization’ strategy by rejoining the US dollar-based settlement system as part of a broader economic pitch to a potential Trump administration. The proposal ties renewed dollar settlement and expanded US–Russia economic cooperation — spanning fossil fuels, natural gas, offshore oil, critical minerals (lithium, copper, nickel, platinum), long-term aviation contracts, joint energy and nuclear projects (including AI applications) — to progress on a Ukraine peace agreement. The memo envisions US firms returning to the Russian market and recouping prior losses. Western officials remain skeptical, noting no evidence the plan has been formally presented to the US and questioning whether Moscow would risk harming Sino-Russian ties, given China’s role in Russia’s trade and non-dollar settlement options. Markets could see effects on energy price volatility and global currency dynamics: a Russian pivot back to the dollar would strengthen dollar dominance and challenge RMB internationalization. Key actors: Kremlin, Russian government, Donald Trump (potential US administration), Vladimir Putin; source: Bloomberg/Walter Bloomberg. Primary keywords: Russia dollar settlement, de-dollarization, US–Russia economic cooperation, Ukraine peace, energy markets.
Neutral
This development is classified as neutral for crypto markets. The memo describes a geopolitical and macro-financial shift — Russia potentially re-entering dollar settlement and pursuing wide-ranging US economic cooperation tied to a Ukraine peace deal. Direct links to cryptocurrency are limited: the story mainly affects fiat currency dynamics and energy markets. A Russian return to dollar-based trade would likely reinforce the US dollar’s global dominance, which historically correlates with mixed effects on crypto: stronger dollar can pressure dollar-priced crypto in the near term, while reduced geopolitical fragmentation could lower demand for crypto as a hedge. Short-term market reactions could include volatility: traders may sell on dovish geopolitical progress (reducing safe-haven flows) or buy risk assets if sanctions relief is priced in. Long-term, a sustained rollback of de-dollarization would likely be bearish for narratives promoting crypto or alternative currency adoption as replacements for dollar-denominated settlement, potentially slowing institutional urgency to diversify away from USD. However, crypto-specific drivers (on-chain metrics, regulatory moves, macro liquidity, BTC ETF flows) will remain dominant. Similar past events: tentative détente or sanction-easing proposals (e.g., talks that reduced sanction risk) have produced short-term risk-on moves in equities and oil, and transient pressure on BTC; broader, structural currency shifts historically take years to materialize and thus exert gradual pressure rather than immediate decisive moves.