1 August 2026
Sanctions Imposed On Russia Could Push Other countries To Adopt CBDC
One of the banking executives, Hiromi Yamaoka said that the conflict in Ukraine could influence central bank digital currencies (CBDCs) policy globally.
Bank of Japan’s former head of payments and settlements department sees countries such as China exploring CBDCs to counter the dominance of US dollars.
World powers have imposed strict sanctions since Russia invaded Ukraine on its “special military operation.” These sanctions have cut the country’s access to foreign exchange, making it impossible to make settlements in US dollars.
As per Yamaoka, sanctions that use financial infrastructure should not be overused to maintain efficacy. He said, “the most effective, powerful weapon was the freezing of Russia’s foreign reserves.”
Yamaoka believes that these sanctions reveal the effect of politics and national security on global financial infrastructure. After seeing how much power western countries wield with this sanction, China may decide to launch the digital yuan as an alternative currency for cross-border settlements.
Yamaoka added that China could “create a currency bloc,” and from now on, “defense and national security will likely become key themes when debating CBDC.”
Disclaimer: The author’s thoughts and comments are solely for educational reasons and informative purposes only. They do not represent financial, investment, or other advice.
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