Amid unprecedented financial sanctions against Russia, there are growing fears that the aggressor country will use cryptocurrencies to circumvent restrictions. However, Crypto experts believe this is unlikely, writes Cointele graph. Jake Chervinsky of the Blockchain Association believes that “Russia cannot use crypto to avoid authorizations.” He makes three arguments: Click this image below to start your bitcoin journey.
First, sanctions are not limited to the US dollar; businesses are prohibited from conducting any transactions with Russia. Second, the financial needs of the Russian Federation far exceed the ability of the crypto market to meet them. Third, the expert believes that even if the cryptocurrency market had sufficient liquidity, its transparency would not allow Russia to hide its transactions.
Finally, Russia does not have the infrastructure to use cryptocurrency. Moreover, there is no legislation to regulate digital money. According to Chervinsky, this shows that Russia has never intended to use cryptocurrency to avoid sanctions. There is also news that new sanctions against Russia have been imposed on Russia.
Putin has been building Russia for years that would be invulnerable to sanctions, but cryptocurrency was not part of those plans. Instead, his strategy was to diversify reserves in yuan and gold (not crypto), move trade to Asia (not to the blockchain), return production capacity to the country, etc., – said the expert.
What makes Russia different from the DPRK
North Korea, Venezuela and Iran are now able to “evade sanctions and hide wealth” through cryptocurrency, agrees Roman Bieda, fraud investigations head on the Confirm blockchain analysis platform.
However, experts point to several features of the case of Russia, including the scale of sanctions, low levels of cryptocurrency implementation and a very shallow market. Ari Redboard of TRM Labs, which investigates cryptocurrency-related crimes, believes the blockchain’s transparency makes it much harder to evade sanctions.
Crypto users have already transferred about $ 20 million in cryptocurrencies to Ukraine.
In the last two days alone, the Return to Alive Fund has received about $ 7 million in cryptocurrency, the fund’s representatives said on their Facebook page. At the same time, the KUNA cryptocurrency exchange announced almost $ 13 million in funds raised.
“Come Back Alive” received $ 7 million.
“The Ukrainian and global high-tech crypto industry are actively involved in helping our defenders. And in the last two days alone, the Return Alive account has received about $ 7 million in cryptocurrency.
Meanwhile, the occupier continues to attack Ukrainian cities and kill our people. Russia attracts all its resources but will not win! Because Ukraine has excellent support. As never before! Thank you! “- reported in the fund.
Bitcoin bypassed the ruble by capitalization.
As the Russian financial authority stated, that money supply on February 1 amounted to 65.3 trillion rubles, or about $ 629 billion, while the market capitalization of bitcoin at the time of writing was $ 824 billion.
Due to sanctions against Russia, the ruble and other Russian assets collapsed, and the Russian central bank announced an increase in the key rate to a record 20%. At the same time, the activity of cryptocurrency users in Ukraine and Russia has increased these days significantly, possibly due to concerns about the devaluation of the fiat currency. So on February 28, the price of bitcoin broke the mark of $ 40,000. “Come back alive” reminded those who want to make a charitable contribution in cryptocurrency can do so at the addresses released by Ukraine.
Bitcoin: Ideal for undermining sanctions.
Cryptocurrencies like Bitcoin are decentralized and comparatively anonymous. This makes them ideally suited to circumvent economic sanctions – a problem in searching for penalties for Russia.
In the case of Russia, for example, there are discussions about excluding the country from the Swift international payment network, which enables global payments via a uniform system. The exclusion of Swift is a tried and tested means of sanctions; for example, Iran was excluded from economic sanctions. First, the EU wants to put hundreds of people and companies, including around 350 members of the Russian parliament, on a sanctions list.
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