US President-elect Donald Trump could sanction stablecoin issuers when he takes office next month, a Russian expert has warned.
In an interview with News.ru, the financial analyst and trader Artem Zvezdin claimed that Trump sanctions on coins like USDT could see Moscow-held tokens “suffer the same fate as Russia’s gold and foreign exchange reserves.”
Will Trump Sanction Stablecoin Issuers?
Zvezdin noted that billions of USD worth of Russian assets were frozen in the West in 2022 after the outbreak of war in Ukraine.
The expert said that USD-pegged token issuers could face an unenviable choice: To either unpeg from the dollar or risk being “completely frozen.”
Multiple Russian media outlets and experts have hinted that domestic firms use stablecoins to trade with international partners.
This helps them evade Western sanctions and also avoids the need to use Bitcoin (BTC). The Russian Central Bank has previously expressed a disdain for BTC and other “private cryptoassets.”
Zvezdin suggested that Trump could respond by “imposing sanctions on companies that are accountable to the US.”
“In this case, people who own stablecoins will end up with not even candy wrappers. They will have nothing more than a few numbers on a screen.”
Zvezdin
Peg in Peril?
The expert noted that in order to maintain their dollar pegs, companies that issue stablecoins buy US Treasury bonds, stocks, and other traditional financial assets.
In this way, he explained, “parity is achieved,” with “one stablecoin equal in value to one dollar.” Sanctions could threaten this equilibrium, he said.
Zvezdin added that Washington is “unhappy with the fact that” crypto “is being used to circumvent sanctions.”
And he said the US thinks that Moscow and its allies Iran and North Korea all use crypto to make cross-border payments.
Trump may also worry that the US dollar “monopoly” could “collapse” due to the growth of crypto-powered international settlements, the expert said.
Crypto adoption is on the rise in Russia. Many firms now using tokens as a trade tool.
Moscow thinks Russia’s fast-growing crypto mining industry can help bolster this.
However, the popularity of home-based mining is causing a drain on some power grids. And some lawmakers have warned that private mining is hurting the Russian economy.
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