Mikhail Degtyarev, the lawmaker who proposed the bill, compared the dollar to a Ponzi scheme. He warned that the government would have to bail out Russians holding the U.S. currency if it collapses.
“If the U.S. national debt continues to grow, the collapse of the dollar system will take place in 2017,” said Mr. Degtyarev, a member of the nationalist Liberal Democrat Party who lost in Moscow’s recent mayoral election.
“The countries that will suffer the most will be those that have failed to wean themselves off their dependence on the dollar in time. In light of this, the fact that confidence in the dollar is growing among Russian citizens is extremely dangerous.”
The bill would partially revive a Soviet-era ban on the dollar. It would prohibit Russians from holding dollars in the country’s banks, and banks would be unable to carry out transactions in the dollar.
However, Russians still would be able to buy or sell dollars while abroad and hold dollar accounts in foreign banks.
Russia’s Central Bank and the government would be exempt from the law.
Russian financial analysts were largely critical of the bill, which they suggested was more about making political capital on the back of rising anti-U.S. sentiment in Russia than protecting the country’s economy.
“The American financial system, despite all its existing problems, remains the most stable and low-risk in the world,” said financial analyst Andrei Shenk.
He also warned that the bill would harm Russia’s investment climate.
Another analyst warned that the bill would strip Russians of the ability to flee the country to seek greater political and social freedoms.
“The right to the free exchange of currencies is a fundamental element of capitalism,” said Moscow-based economics analyst Igor Suzdaltsev. “It allows citizens to leave the country when a dictatorship is imposed by selling their property and exchanging their assets for the necessary currency.”