After Vladimir Putin ordered the invasion of Ukraine, the United States and more than 20 other countries sanctioned Russia, kicking it out of SWIFT. As a result, the Russian ruble crashed, hitting its lowest point in history. At the moment of writing, one ruble is worth about 0.8 cents. That prompted a huge number of Russians to turn to cryptocurrency, selling a record amount of rubles to buy digital currencies.
At the same time, people from all over the world have been sending crypto donations worth millions of dollars to Ukraine. In fact, since Putin invaded Ukraine on February 24, more than 110,000 donations were made to the Ukraine Government and an NGO called Come Back Alive, totaling nearly $60 million.
BTC-RUB Daily Volume Reaches Its 9-Month High
Trading volumes between ruble and BTC has reached a nine-month high following the sanctions imposed on Russia by the US and its allies.
According to a French cryptocurrency research company called Kaiko, more than 1.5 billion rubles were used for cryptocurrency trading since the start of the war – the highest trading volume since May 2021.
It’s no surprise that Russians have started focusing more on digital currencies as their fiat currency has plummeted by nearly 50% of its pre-war value.
West to Impose Bitcoin Sanctions on Russia?
As Washington continues to inflict heavy sanctions on Russia, the next step could be to ban Russians from trading digital currencies on US-owned platforms. The concern is that Putin and his associates might be using cryptos to evade the sanctions.
However, the US Department of Justice is currently working on putting an end to it. The Department has created a task force that would check whether such a thing is actually going on, and if is, how to deal with it.
The easiest way would be to simply ban Russian users from trading cryptos on American platforms. That’s something that has already been suggested by Ukrainian officials numerous times since the start of the invasion. Their call, however, wasn’t met with approval by the people behind the world’s largest crypto exchanges.
Binance, for example, said they have no intention to “unilaterally freeze millions of innocent users’ accounts.” Further, the boss of Kraken, Jesse Powell, said that it’s not possible to do so without a legal requirement.
Although American exchanges still haven’t blocked Russian users, there are some countries where that’s already happened. In South Korea, all exchanges have already blocked all accounts with Russian addresses. The same thing is happening in Japan, where the government has laid out a plan of fining exchanges that violate the ban with a three-year prison sentence.