Alternative payment systems emerging alongside dollar, says Fradkov

The dollar's share of global payments still fluctuates between 40% and 50%, but alternative systems are emerging, A7 executive Fradkov told RBC. Citing Artemis Analytics, he said stablecoin transaction volumes should reach $33 trillion in 2025, against Visa's $16.7 trillion and Mastercard's $10.6 trillion. Total stablecoin capitalisation stands at $312 billion, with about 99% dollar-linked. The ruble-pegged A7A5 is capitalised at about $570 million, he said.

Written by AI from Economic Times — Industry · not yet reviewed by an editor · Published 29 Sept 2026, 10:19 am IST

Source

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#stablecoins#cross-border payments#russia#sanctions#ruble#fintech

Desk check · some claims need care

What the desk checked (5)

The dollar's share in global payments fluctuates between 40% and 50%. — Figure appears in source, stated by Fradkov without specific attribution.
Stablecoin transaction volume is expected to reach $33 trillion in 2025, up 72% year-on-year, against Visa's $16.7 trillion and Mastercard's $10.6 trillion. — Attributed in source to Artemis Analytics; comparison figures unattributed.
Total stablecoin market capitalisation is $312 billion, with about 98-99% dollar-linked. — 98% figure attributed to BIS in the interviewer's question; the 99% variant is Fradkov's estimate.
A7A5, the ruble-pegged stablecoin, has a capitalisation of about $570 million and turnover of nearly $140 billion since inception. — Self-reported by the company executive; no independent source given.
A7 has paid 25.5 billion rubles in taxes since starting operations. — Self-reported by Fradkov; no documentation cited in source.

Written by AI from Economic Times — Industry · not yet reviewed by an editor · How we use AI · Report an error

Analysts’ view opinion

AI Economic Analyst

Strip out the geopolitics and this is a story about the economics of payment rails: who collects the toll on cross-border money, and whether that toll can be undercut. Fradkov's own numbers make the awkward point for him — stablecoin volumes he cites at $33 trillion for 2025 dwarf Visa and Mastercard, yet roughly 99% of the $312 billion stablecoin float is dollar-linked, so the 'alternative' largely runs on dollar collateral. The ruble-linked A7A5, put at $570 million, is a rounding error against that, which tells you the cost-and-liquidity problem is far from solved.

The commercial prize is the spread: slow multi-day settlement and fat commissions are a cost to payers and revenue to the incumbent infrastructure owners, which is exactly the margin a new rail tries to capture.
A quoted 0.3% commission plus VAT is a low-margin, volume-dependent model — it only works economically at scale, and the story says investment has not yet fully paid back.
Dollar dependence is being re-shelled, not removed: if almost all stablecoin value sits in dollar claims and Treasuries, the underlying exposure to US monetary conditions and to issuer-level blocking powers persists.
Liquidity, not technology, is named as the binding constraint — currency pools and funding lines are the scarce asset, and that is where costs and counterparty risk concentrate.
Demand-side logic is real: high remittance and trade-payment costs in large, fast-growing markets such as Nigeria create genuine appetite for cheaper alternatives, independent of any sanctions motive.

What to watch — Watch whether non-dollar settlement volumes and A7A5-type instruments grow into economically meaningful scale, and whether tightening European compliance and sanctions on crypto services raise the effective cost of using such rails for third-country businesses.

The story rests largely on one participant's account and third-party estimates; it does not establish independently verified volumes, profitability, the actual cost saving to users, or the legal standing of these arrangements in the jurisdictions involved.

Deep dive

Research brief · 8 facts · 5 dates · exam-ready

The brief

Context

In an interview with Russian outlet RBC, an executive of A7 — a Russian cross-border payment venture developed with PSB — argues that the dollar-centric global payment architecture is being supplemented, not replaced, by national and regional alternatives. He says financial restrictions imposed on Russia in 2022 were the trigger for building A7, which combines traditional banking, brokerage and digital tools, and which issued A7A5, a ruble-pegged stablecoin. The interview frames stablecoins as a fast-growing but possibly temporary payment layer still overwhelmingly tied to the US dollar.

Key facts

Fradkov says the dollar's share of global payments still fluctuates between 40% and 50%.
Citing Artemis Analytics: stablecoin transaction volume is expected to reach $33 trillion in 2025, up 72% year-on-year, versus Visa's $16.7 trillion and Mastercard's $10.6 trillion.
Flows linked to SWIFT infrastructure are estimated at about $150 trillion.
Total stablecoin market capitalisation is about $312 billion; BIS puts 98% of value as dollar-tied, Fradkov says 99% by some estimates; USDT is the most popular.
A7A5, the ruble-pegged stablecoin, is capitalised at about $570 million — the largest non-dollar stablecoin; a euro-pegged stablecoin follows at $440 million and a Brazilian one at $52 million.
A7A5 turnover since inception has reached nearly $140 billion.
Per the Central Bank, the ruble's share in export earnings is expected above 53% by end-2025 and about 55% in import payments.
A7 says it has paid 25.5 billion rubles in taxes since starting operations, earning a commission of 0.3% plus VAT.

Timeline

2022Financial restrictions imposed on Russia — described as the most severe of all limitations — trigger the creation of A7.
Recent yearsTether blocks significant assets of holders from Iran and Russia, including at the request of the US administration, per Fradkov.
Not dated in the sourceA7 officially opens an office in Nigeria; Russia's State Duma passes the law on 'Digital Currency and Digital Rights' in second and third readings.
2025 (expected)Stablecoin transaction volumes to reach $33 trillion; ruble share above 53% of export earnings and about 55% of import payments.
By 2050Africa's population projected to grow to 2.5 billion; Nigeria forecast to reach 400 million in 15-20 years from almost 250 million.

Who has a stake

A7 and PSB — Building a Russian-origin but internationally functioning payment architecture where settlement does not need a third party's approval.
Tether Limited / USDT holders — Tether retains full control over issued USDT and can block tokens at its discretion, wherever held, per Fradkov.
Visa and Mastercard — Card networks with 2025 volumes of $16.7 trillion and $10.6 trillion, now smaller than projected stablecoin flows.
Global South countries (Africa, Latin America, parts of Asia) — Payments seen as a bottleneck; countries like Indonesia and Brazil are developing their own alternative rails and national-asset stablecoins.
European Union — Latest sanctions package imposes sectoral sanctions on Russian crypto services and threatens extension to third countries; A7 says it has not been affected.
Nigeria and African economies — Large, restriction-bound markets; about a dozen African countries still lack central banks, per Fradkov.

Why it matters

Payments have become an instrument of geopolitics, and the numbers cited suggest a parallel settlement layer is scaling fast even as roughly 99% of stablecoin value stays dollar-linked. For India and other Global South economies, the debate over national-currency trade, domestic payment rails and exposure to third-country compliance directly shapes trade costs and strategic autonomy. It also highlights that shifting off the dollar in currency terms does not automatically end dependence on foreign infrastructure and control points.

UPSC angle

Prelims pointers

Stablecoin transaction volume projected at $33 trillion in 2025 (Artemis Analytics), against SWIFT-linked flows of about $150 trillion.
Total stablecoin market capitalisation about $312 billion; BIS estimates 98% of value pegged to the US dollar.
A7A5 is a ruble-pegged stablecoin, the largest non-dollar stablecoin at about $570 million.
USDT is issued by Tether Limited, registered offshore, and is among the largest holders of US Treasuries.
CIPS is China's yuan payment system, named in the interview as both potential competitor and partner.
Russia's State Duma passed the law on 'Digital Currency and Digital Rights' in second and third readings.

Mains framing

The interview illustrates how sanctions and the dollar's role as 'soft power' in payments have pushed several states to build their own settlement infrastructure rather than merely switch invoicing currencies. The causes are concentrated: an oligopolistic payment system where a few players set prices and terms, slow and costly correspondent banking, and foreign compliance and liquidity chokepoints that allow precise control over inter-country flows. The implications are twofold — a plural landscape of national, regional and inter-regional systems that compete yet interoperate (as Fradkov suggests of CIPS), but also a new form of dependence, since roughly 99% of stablecoin value is dollar-linked and issuers like Tether can freeze tokens at will, effectively reproducing compliance in a different technical shell. Fradkov also concedes stablecoins may be temporary and that liquidity management, not technology, is the hardest asset to build. A credible way forward, on the source's own logic, combines national-currency settlement with domestically controlled rails, transparent taxation and regulation (as with Russia's digital currency law), diversified liquidity pools across jurisdictions, and partnerships with Global South economies in Africa, Latin America and Asia — while recognising that secondary-sanctions risk and incumbent resistance will determine how fast any alternative scales.

Key terms

Stablecoin: A digital token pegged to a currency or asset; total market capitalisation about $312 billion, with about 99% dollar-linked.
A7A5: Ruble-pegged stablecoin issued by A7, capitalised at about $570 million with turnover of nearly $140 billion since inception.
USDT / Tether Limited: The most popular dollar stablecoin and its offshore-registered issuer, which can block tokens at its discretion and holds large US Treasury positions.
CIPS: China's yuan-denominated payment system, described by Fradkov as designed for China but a possible partner as well as competitor.
Secondary sanctions: Penalties extended to third-country entities dealing with a sanctioned party; the EU's new package threatens such reach, per the interview.
KYC: 'Know your customer' identity-verification system; A7 says it built its own compliance, risk management and KYC framework.

Practice questions

Shifting to national currencies in trade does not by itself end dependence on foreign payment infrastructure. Discuss with reference to compliance, liquidity and settlement control.
Stablecoin transaction volumes are projected to exceed those of Visa and Mastercard combined, yet 98-99% of their value is dollar-pegged. What does this imply for monetary sovereignty in developing economies?
Examine the risks and opportunities for Global South economies in building alternative cross-border payment systems amid the threat of secondary sanctions.

Grounded only in the source report — figures and dates are the source's, not inferred.

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