The surge of cryptocurrencies is now presenting a new opportunity for certain countries providing them new options to break away from financial institution dictation on their trading prices.
Oil price is a huge contributor, as certain OPEC nations index the value of barrels of oil in dollars, tying the commodity to USD. The western powers have imposed sanctions on those countries that have an abundant supply of oil, hindering their ability to trade the resource.
Russia and Iran may follow Venezuela and are now looking into using cryptocurrency, as an alternative to the dollar.
Certain oil analysts see these countries using digital currency as a way to sell oil. Stephen Brennock, a PVM Oil Associates Analyst, states that these digital currencies are a way to break free from the dollar.
“The advent of cryptocurrencies, therefore, represents a fresh catalyst for commodity-producing countries wishing to abandon the dollar as a means of payment for oil.”
Oil heavy countries have been looking into cutting out the dollar for an extended period of time now. A currency swap agreement between Iran, Russia, and China is currently in the works, as China works a deal with Venezuela directly. The possibility of these trades occurring with digital currency is extremely high but it remains unknown which cryptocurrency they intend on using.
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