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- The soft power of blockchain: Can digital currencies destroy the hegemony of the dollar
The soft power of blockchain: Can digital currencies destroy the hegemony of the dollar
The geopolitical shocks of recent years have intensified the trend towards de-dollarization. The process of reducing dependence on the US currency in international trade, financial settlements and government reserves contributes to the growing interest in digital assets. More than 130 countries are developing their own digital currencies that can be used in cross-border payments. In particular, all the central banks of the BRICS countries are involved in the development of this area. China has already achieved significant success — payments in digital yuan for businesses are available in more than 30 countries and regions of the world. Whether digital currencies will be able to put an end to the dollar's hegemony is in the Izvestia article.
The Independence code
The interest in reducing the role of the dollar is largely due not only to politics, but also to practical considerations — currency risks are a key factor. When the revenue base is formed in national currency, and project implementation, trade operations, and sovereign borrowing are denominated in dollars, national governments and companies are vulnerable to devaluation shocks. Geopolitical and sanctions risks only exacerbate this problem, which forces the authorities of different countries to look for new, more sustainable ways of economic interaction.
The dollar's share in international settlements remains significant. According to the SWIFT interbank messaging system, by the end of February 2026, it was 49.25%. However, more and more countries are seeking to pay each other in national currencies. For example, the ruble and the currencies of friendly countries account for most of the payments in Russia's foreign trade turnover. In particular, Russia and China have already switched to settlements in yuan and rubles by 99.1%.
In this context, central bank digital currencies (CBCS) are considered a promising alternative for cross-border settlements. These are legal tender funds that are issued by the state (which is the main difference between such digital assets and cryptocurrencies). The creation of a new form of fiat money is traditionally associated with strengthening financial stability and strengthening control over the payment services market (operations are fully transparent). The advantages also include transaction security, increased efficiency of financial intermediaries by reducing transaction costs and reducing operational and credit risks.
However, there are disadvantages to central bank digital currencies. One of the main issues is the need to reorganize the entire financial system. The introduction of new money requires not only the creation of a different payment infrastructure, but also an audit of current legislation. This directly affects the pace of development of digital currency securities — from a technological point of view, digital money is developing faster than from a legal point of view.
At the same time, there are risks of technical difficulties at the initial stages of the introduction of the new currency. Cybersecurity issues also remain relevant.
Betting on a number
In any case, the trend towards global digitalization of the economy, which gained momentum during the coronavirus pandemic, motivates central banks to develop a new currency that meets the trends of the times. Currently, more than 130 countries are exploring or testing their own digital currencies. In a number of countries, central securities have already been approved as an official means of payment. The Commonwealth of the Bahamas and Cambodia were the first to announce such a decision in the fall of 2020.
Digital currencies are of particular interest to emerging economies. It is assumed that such money will not only strengthen the sovereignty of the state, but also increase the availability of financial services (for example, with an underdeveloped banking sector).
Currently, all the central banks of the BRICS+ countries are involved in the creation of digital currencies. However, the process is at different levels — China, India, Russia, the UAE and Iran are already conducting pilots or scaling, while Ethiopia and Egypt are engaged in research and development.
China occupies one of the leading positions in the development of central securities not only in BRICS, but also in the world. As of July 2025, the number of personal digital wallets in yuan has exceeded 420 million (for comparison, in July 2024 there were 180 million). The average monthly number of transactions reached 210 million, and the average monthly amount was 480 billion yuan ($68 billion).
The digital currency of China is gradually penetrating into cross-border settlements. As of July 2025, payments in yuan for businesses were available in more than 30 countries and regions. The volume of cross-border transactions in digital yuan has exceeded 120 billion.
Since 2022, India has been conducting a pilot launch of its own digital currency. At the first stage, the experiment took place in only four cities — Mumbai, New Delhi, Bangalore and Bhubaneshwar. Four of the country's largest banks participated in the project — State Bank of India, ICICI Bank, Yes Bank and IDFC First Bank. Gradually, the geography and number of companies expanded. By March 2024, the number of users among individuals amounted to 4.3 million. Another 4 million wallets were registered by a legal entity.
In Russia, the digital ruble has also been developing for several years. A prototype of its platform was developed in December 2021. Since 2023, a pilot has been launched with the involvement of a narrow range of customers (about 600 people and 22 companies). Currently, more than 1300 clients are participating in the program, who have performed about 30 thousand operations. In September 2025, salaries were paid in digital rubles for the first time. The recipient was Anatoly Aksakov, head of the State Duma Committee on the Financial Market. The mass introduction of the digital ruble is scheduled for September 2026.
The desire to simplify mutual settlements is one of the reasons for the BRICS countries' interest in central securities. However, this requires not only a currency, but also an infrastructure for international payments. The most mature of the cross—border projects in this area today is mBridge, an experimental cross-border payment platform using digital currency and blockchain technology for instant payments between countries. The system was developed by the Bank for International Settlements (BIS), as well as the central banks of China, Hong Kong, Thailand and the United Arab Emirates, with the participation of Saudi Arabia. In January 2024, with the help of mBridge, the UAE made the first non-test transaction to China in the amount of 50 million digital dirhams ($13.6 million).
In February 2024, the BRICS Bridge project based on mBridge technology was announced. It was about creating a platform that would bring together all the BRICS+ member countries, allowing them to conduct faster, safer and more efficient transactions in digital national currencies. However, the association's members' attitude to this initiative turned out to be uncertain, and this project was not included in the final documents of the BRICS summit in October 2024.
At the same time, in December 2025, it became known about the launch of the Unit digital currency by the BRICS group. It is an instrument backed by a reserve basket consisting of 40% physical gold and 60% of the currencies of the union countries, evenly distributed between the Russian ruble, Chinese yuan, Brazilian real, Indian rupee and South African rand. It is expected that Unit will become a neutral settlement tool, reducing dependence on the US dollar in trade between the BRICS countries.
The Great Wall of China
Olga Borisova, Associate Professor of Corporate Finance and Corporate Governance at the Financial University under the Government of the Russian Federation, is convinced that the main threat to the dollar today is the Chinese yuan. Its role in cross-border payments is enhanced by sanctions imposed against Russia and Iran, as well as a significant share of Chinese exports worldwide.
Recently, the conflict in the Middle East has contributed to the use of the yuan in settlements. Iran, in particular, has introduced a fee for the passage of oil tankers through the Strait of Hormuz, accepting it in Chinese currency or stablecoins. And the increasing importance of the yuan in cross-border payments contributes to the popularization of its digital form.
The advantage of trading using digital currencies, according to Andrey Stolyarov, Deputy head of the Basic Department of Financial Market Infrastructure at the HSE Faculty of Economics, is that it is beyond the control of regulators in unfriendly countries, which allows it to circumvent sanctions.
The introduction of digital currencies by the BRICS+ countries will become a threat to the dollar in the medium term, Petr Shcherbachenko, associate professor at the Financial University under the Government of the Russian Federation, expects. At the same time, various payment tools are becoming more and more available, which reduces dependence on SWIFT.
It is also important that in the long term, digital currencies can replace traditional fiat money, Borisova admits. Therefore, the importance of central securities in the process of de-dollarization will only increase in the future.
However, according to Stolyarov, digital currencies are unlikely to completely replace traditional fiat money in the coming years. Therefore, the main threat to the dollar now, in his opinion, is related not so much to the creation of digital yuan, rubles or rupees, as to the emergence of alternative trading systems and the departure from settlements in the US currency.
In addition, there are still some barriers hindering the development of digital currencies in settlements. Among them, Borisova highlights the restrictions on transactions by regulators, difficulties with free conversion, and the need to establish the currency's reputation as an international unit of account.
Therefore, the use of digital currencies in cross-border settlements will reduce problems in this area, but will not completely solve them, summarizes Stolyarov.
Переведено сервисом «Яндекс Переводчик»
