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Wednesday, August 10, 2022

Russia-Ukraine conflict forces Bitcoin sanction on the former

The Russia-Ukraine conflict has impacted the world in a lot of ways. From conflict between nations to the world economy, the war has done nothing but add challenges that need to be faced. With this, there are a lot of countries that are in the opposition seeking world peace with hopes to end the warfare.

In March 2022, Bitcoin’s price increased by as much as 16%, continuing its sharp turn as the Russian assault on Ukraine further encouraged the U.S. to apply the necessary sanctions to cripple the former.

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According to Coin Metrics, the Bitcoin market as a whole jumped up to 6% in the last 24 hours on the same day with a record of around $44,000 per coin. The surge came right after the plummet of all crypto prices during the final week of February 2022.

With every recent Bitcoin casino blog, there is no doubt that you’ll see every headline centering around the premise of the rise of BTC and where it sides in the war of 2 nations.

Crypto evading sanctions?

Talks of banning the use of crypto sparked controversy due to miners dismissing Russian sustainability goals and avoiding pyramid schemes.

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However, further increase in popularity and growth occurred. ‘I would say that’s the reason why bitcoin has shown strength now — because the Russians have a way of getting money out, getting their wealth out’, Mark Mobius said, the CEO and founding partner of Mobius Capital Partners.

Bitcoin’s price jump started when the United States imposed sanctions that froze Russia’s assets that are held in American banks. The sanctions were made to impede Russian oligarchs who are funding the warfare in favour of Russia.

CEO of Valkyrie Investments, Leah Wald, proposed the idea that the Russian markets would make use of crypto to get around the hurdles of getting sanctioned. ‘It is highly unlikely but misguided, since it is far easier to track on-chain transactions than cash’.

Venture associate, Michael Rinko, also said it would be easier to censor the Russian government if it were to solely use Bitcoin to manage the country’s central bank reserves. In that sense, anyone will be able to see and control the monetary cash flows of all bank accounts managed by the central bank.

‘At that point it would depend on Europe and the U.S. to pressure the biggest exchanges — Coinbase, FTX and Binance — to blacklist the addresses associated with Russia, and then no other major exchange would want to interact with funds that originated from those addresses’, stated Rinko. ‘So they’d be able to freeze bitcoin funds or other crypto that touched a Russian account’, he added.

Stablecoins remain the safe haven during the conflict

Since the invasion of Russia started, transactions on any BTC exchanges in both the Ukrainian hryvnia and Russian ruble experienced massive growth according to the Kaiko, a digital assets data provider.

Research director at Kaiko, Clara Medalie, informed that the volume of Tether against Russian ruble is twice as high as that of Bitcoin’s volume. This suggests that stablecoins might play a huge part in warfare as safe havens in challenging times.

‘Most dollar-pegged stablecoins such as Tether or USDT are issued by centralised companies that could be targeted by sanctions, which could force them to monitor transactions’, Clara said.

On the other hand, Rinko stated that the Russian–Ukrainian conflict isn’t the entire reason for the outperformance of recent crypto-related surges. There are also other unique and circumstantial factors like the rates of the Federal Reserve hiking for the past few weeks in March 2022 and the inherent effects of the plummetage of crypto prices that lead to more investors buying coins at a relatively cheaper price point.

When considering these factors, one can assess that the use of specific stablecoins rendered positive light in major coins like BTC to grow as well due to the very nature of the crypto market itself.

With newsletters like a Bitcoin casino blog speaking about the sensitive topic at hand, its exposure in different times will definitely have an impact in the industry as a whole, perhaps as proof that it’s the future currency for the people.

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