International finance and economic institutions: Can Russian Ruble become the world’s leading currency?

Abstract

Our paper focuses on the recent leading institutional trends in finance and economy of the Russian Federation. In particular, we analyze the past developments and economic crises that impacted the Russian economy and caused many adverse effects to its development. We focus on the role of economic sanctions imposed by the Western countries on the Russian economy and the outcomes of these sanctions. Then we discuss the country’s current economic and intellectual potential that constitute its valuable assets and the ways they can be monetized. We contemplate over the dependence of Russian economy on world’s oil prices and discuss whether novel information and communication technologies might take the role of oil in Russian economy. The article discusses the issue of whether Russian Ruble might become the world’s leading currency. Our findings show that under certain conditions Russian Ruble might be used as another world’s reserve currency, especially in the face of recent economic and political issues, such as Brexit or American and Chinese trade wars. We demonstrate that Russian Ruble has the potential to follow the path set by the Digital Currency Electronic Payment (DCEP), a digital currency issued by the central banks, such as, for example, the recently launched “digital yuan” (also known as the e-CNY or digital RMB) issued by the People’s Bank of China. Such a currency provides enormous opportunities for the digitalization of financial markets and changing the institutional aspects of their functioning.