Bitcoin Fuels Energy Deals Between Russia and China During Shifting Geopolitics
Bitcoin Gains Traction in International Trade During Tariff Tensions.
VanEck reports that China and Russia are now settling energy trades using Bitcoin.
This shift is occurring as new tariffs from Donald Trump impacted China and the European Union on April 2nd.
The tariff’s announcement briefly lowered Bitcoin’s price from $85,000 to $81,000.
The price declined further over the weekend.
Bitcoin has still outperformed the Nasdaq across all evaluated periods: week, month, year-to-date, and the past decade.
Sanctions and Economic Uncertainty May Favor Bitcoin’s Rise
VanEck suggests global responses to these tariffs might bolster Bitcoin in the long run.
If the U.S. economy slows without a simultaneous inflation spike, the Federal Reserve might again cut interest rates.
Such cuts would re-establish an easy-money environment, a condition historically advantageous for Bitcoin.
Concurrently, nations seeking alternatives to U.S.-dominated financial systems are exploring crypto as a neutral method to move capital, especially for large transactions such as oil and electricity.
Russia Turns to Crypto for Oil Trade with China and India
Reuters reported last month that Russia is employing crypto—Bitcoin, Ether, and Tether—to manage oil trades with China and India.
Russia enacted a law last summer permitting crypto for international trade, but oil companies now utilizing it for actual oil sales marks a new phase.
The International Energy Agency calculated Russia’s oil trade reached $192 billion last year.
Crypto still constitutes a small fraction of this total, but it is expanding.
Millions in Crypto Payments Flow from China to Russia Via Middlemen
A source with insight into oil trader operations reportedly informed Reuters that crypto payments to China reach tens of millions of dollars monthly.
Middlemen execute these payments. Chinese buyers deposit yuan into an offshore account
Then middlemen convert it to crypto, send it to another account, and finally convert it back to rubles in Russia.
Crypto as a Sanctions Evasion Tool and a Hedge Against Dollar Weakness
Other nations have adopted similar strategies.
Iran and Venezuela both used crypto to sustain their oil business under U.S. sanctions.
Venezuela even increased crypto usage after Washington reinstated sanctions.
Russia stated last year that sanctions caused significant payment delays across its economy.
Currently, Trump, in the White House, advocates ending the war in Ukraine.
He has mentioned easing Russian sanctions, but no actions are final.
Indeed, on March 7th, Trump posted that he is “strongly considering” further sanctions.
Bitcoin’s Role Expands During Shifting Global Alliances
Besides Bitcoin, Russia still uses traditional workarounds, such as the UAE dirham, for oil trades.
Crypto’s role grows as one of the available options.
In its report, VanEck argues any dollar depreciation could reinforce Bitcoin’s narrative as a hedge amidst fracturing global alliances.
If China or the EU counters U.S. sanctions with their systems, the outcome could stimulate greater interest in crypto.
