Russia and Iran are accelerating their move away from the U.S. dollar and toward the Chinese yuan as Western sanctions and geopolitical pressures deepen, according to a new report.
Key Takeaways:
In March 2026, China’s CIPS processed approximately $214 billion as Iran and Russia exited dollar markets.Iran’s IRGC is reportedly demanding crypto or yuan for 20% of global oil transit.Chainalysis reports sanctioned crypto use hit $154 billion in 2025, fueling a permanent shift to the yuan.This surge comes as Iran takes drastic measures in response to a U.S.-Israeli air campaign that began in February. Tehran has effectively closed the Strait of Hormuz to “unfriendly nations,” while allowing passage to ships from China, Russia and India.
Russia, largely frozen out of the dollar-based system since its 2022 invasion of Ukraine, has similarly integrated the yuan and digital assets into its war economy. In an August 2025 interview, President Vladimir Putin noted that transactions between Russia and China are now almost entirely conducted in rubles and yuan.
Expanding the Digital FrontierIn Saudi Arabia, the shift is already visible: the share of oil transactions settled in yuan reached 41% in March, the same month two major Saudi state-owned banks joined the CIPS network.
Despite the rapid growth, the yuan still faces a steep climb. According to SWIFT data, the yuan held only a 3% share of global settlements in early 2026, compared to the dollar’s dominant 51%.
However, the divergence is clear. As the yuan strengthens against the dollar, other Asian currencies, including the yen and won, have weakened, burdened by the rising costs of oil priced in non-traditional currencies. Toru Nishihama, chief economist at Daiichi Life Research Institute, said he believes the trend is irreversible.
“The movement away from the dollar will continue to accelerate as these alternative networks reach critical mass,” Nishihama said.
