China’s cross-border yuan settlement network saw a sharp jump in activity as Russia and Iran moved further away from the dollar system. In March 2026, China’s Cross-Border Interbank Payment System, or CIPS, processed roughly $214 billion in transactions, equal to about 1.46 trillion yuan. The total was up 50% from the previous month and about three times the level seen in the same period of 2021, underscoring the growing role of alternative payment rails amid sanctions and geopolitical strain.
Sanctions and conflict reshape trade settlement
The report says both Iran and Russia are expanding the use of the yuan and cryptocurrencies to keep trade flows moving and support state economic activity. In Iran’s case, the shift accelerated after regional military escalation. Tehran reportedly imposed security transit fees on ships moving through the Strait of Hormuz, with payments said to be accepted in yuan or crypto. Ding Shuang, chief economist for Greater China and North Asia at Standard Chartered, said the Middle East conflict had acted as a catalyst and that an early form of the “petroyuan” is now emerging, potentially weakening the dollar’s long-standing dominance in energy trade.
Russia has followed a similar path. Since being pushed further out of the dollar-based financial system after the 2022 invasion of Ukraine, Moscow has steadily increased local-currency trade with China. The article notes that President Vladimir Putin said in August 2025 that transactions between Russia and China were now conducted almost entirely in rubles and yuan. That points to a broader structural shift in how sanctioned economies are rebuilding payment channels outside the Western banking framework.
Crypto gains ground as a parallel payment route
Cryptocurrency has also become an important workaround for entities cut off from traditional finance. A Chainalysis report published in March 2026 found that sanctioned entities received a record $154 billion in crypto in 2025, a dramatic increase from the previous year. The report cited in the article also said that in the fourth quarter of 2025 alone, Iran’s Islamic Revolutionary Guard Corps received more than $3 billion through crypto transfers and used digital wallets to pay for goods and shipping logistics.
The same coverage said the IRGC had required roughly 20% of global oil shipments to be settled in either crypto or yuan. That suggests a dual-track system is emerging in some high-risk trade corridors: crypto offers flexibility where banking access is restricted, while the yuan provides a more stable unit for larger-volume commercial settlement.
Yuan internationalization advances, but the dollar still dominates
Launched in 2015, CIPS has become a key part of Beijing’s push to internationalize the yuan. By the end of 2025, the network had connected more than 1,700 financial institutions worldwide. Beyond CIPS, China has also been testing cross-border use of the digital yuan with partners including Saudi Arabia and the United Arab Emirates, enabling faster settlement without relying on U.S. correspondent banks.
Signs of change are already visible in energy markets. The report says 41% of Saudi oil trades in March 2026 were settled in yuan, and two major Saudi state-owned banks joined the CIPS network during the same month. Even so, the yuan remains far behind the dollar on a global scale. SWIFT data cited in the report shows that at the start of 2026, the yuan accounted for only 3% of global settlements, compared with the dollar’s 51%.
Still, analysts argue the direction of travel is becoming harder to ignore. As alternative payment systems gain scale, sanctioned states deepen financial coordination, and non-dollar settlement grows in energy trade, the global payments landscape may continue to fragment. For markets, that means not only a wider role for the yuan, but also a rising profile for crypto in state-linked cross-border settlement.