Yep, same thing that happened to British Pound Sterling. The Industrial Revolution and the British Empire made it the global reserve currency; war losses, the dismantling of the Empire, and the decline of British industry handled the mantle to the American Dollar. Nothing truly protects USD from the same forces.
China and Russia won't succeed at launching a competing standard though. Autocracy may promote economic growth at home, but it cannot credibly protect the financial interests of foreigners from its own impulsive and selfish desires. You deposit funds into Russian and Chinese banks at your own risk.
CIPS is about getting money to Chinese banks (effectively the only members). The commenter is suggesting that having money in those banks is not a desired outcome for most institutions due to the fact that Chinese finance does not run on the same premises as institutions used to doing business with the west.
It’s going to take a long time for international companies to get the yuan/cips/China bank corridor working, those relationships don’t get built quickly and most places that aren’t dealing directly with China don’t bank there (as opposed to the UK, Ireland or other countries that act as banking nexus’.
Those Chinese banks can’t even be used for traditional style fx management because you’ll have to double fx from local currency to yuan and yuan to ruble. The yuan fx scene is much less efficient and liquid as well.
What this more likely does is set Russian & Chinese firms to trade with each other. That looks a lot like the North Korea relationship.
If I’m a modern treasury that needs to do business in Russia the China corridor requires me to fx to yuan and the fx yuan to ruble. As of now both of those currencies are hard to fx. It’s also hard (relatively) to setup Chinese accounts.
I work in the industry and have seen Chinese banking normalize a bit especially in Africa but comparatively it is tiny and hard to manage. Singapore for instance is a more likely spot to setup banking operations for most companies.
The issue is that these are long term trends. It will take decades to make China a finance nexus on the order of modem banking centers in the west and that presumes China continues to liberalize their currency and finance regime which is not the current trend.
China and Russia won't succeed at launching a competing standard though. Autocracy may promote economic growth at home, but it cannot credibly protect the financial interests of foreigners from its own impulsive and selfish desires. You deposit funds into Russian and Chinese banks at your own risk.