Cryptocurrencies Represent the Shelter of Russia Against Sanctions

Cryptocurrencies Represent the Shelter of Russia Against Sanctions

The high movements of bitcoin price generated during the first weeks of the war between Russia and Ukraine caused great commotion before international organizations.

The volatility of Bitcoin was not an impediment. On the contrary, after being shown a position against digital currencies, the Russian power had to adapt them to maintain its finances.

The transactions reached close to 30 million dollars, which put the European Union in complete alarm since they had already implemented a set of sanctions as pressure measures to end the conflict.

According to expert opinions, the Russian government may have found in cryptocurrencies, specifically Bitcoin, a refuge of value that, even in critical situations, can be used as a fund to carry out various financial operations.

Faced with this situation, the United States suggests that the exchange platforms monitor the operations from this western country more strictly.

This situation caused BITCOIN to increase in value for only a short period, going from $38,000 to almost $49,000.

An Alternative to Sanctions. Although Russia and Ukraine have begun to use cryptocurrencies as a haven for their capital, where they can try to dissipate the effects of the war, if international entities align themselves, they could create some pressure on this.

From the Ukrainian perspective, cryptocurrencies have arrived in the form of donations to help prevent the economic and financial situation of the country from worsening since many citizens have had to emigrate in search of protection.

After Russia began to operate with Bitcoin, the US government started with regulatory measures linked to exchange platforms. As a result, all operations executed with addresses from this country were rejected.

The two large exchange platforms such as Coinbase and Binance, made themselves heard after issuing both statements that they would not block citizens, more if they could restrict the operations that are attempted to be carried out through the entities that are subject to sanctions.

On the other hand, Ethereum has also shown a favorable position regarding the limitation of operations of these Russian addresses, but to which they have assumed the possibility of it being not very easy since the nature of cryptographic transactions is decentralized.

The situation that Bitcoin is currently going through apparently does not make it very attractive since its decrease in value has been significant, it may be that for many, the decision of the countries that are going through the geopolitical confrontation has not been the most successful, but it was the timelier.

The Volatility of Bitcoin Does Not Prevent Its Use. According to previous analysis and research, it has been possible to determine that cryptocurrencies, in this case, Bitcoin, have increased their adoption in situations of tension. However, their volatility is extreme; most people usually deposit their circulating assets in these digital currencies.

Now may not be the best time to invest since many external factors complicate crypto operations. However, it points to a resounding rise.

According to the chronological order in which the events that relate to the war situation between Ukraine and Russia have occurred, it is shown that the volume of operations with digital currencies has increased at the most critical moments.

The operations that took place go from the moment of the invasion. The operations surpassed 10,000 million dollars in transactions; then, this amount reached almost 13,500 million dollars when the sanctions arose.

These amounts indicate that although cryptocurrencies are so volatile, they can represent an option in the face of critical situations that countries may go through.

Many countries may still be skeptical about the possible adoption of cryptocurrencies. Still, this scenario could serve as a reference for what cryptocurrencies represent and their impact on the future.

They may be somewhat complicated, but over time, digital currencies have been positioned on a larger scale among large investors, governments, and individuals.

Their regularization is a topic that is interesting for many organizations since the decentralized characteristics make them attractive due to their low transaction fees.

Conclusion. The main objective is to maintain peace in the world; the sanctions in some way are intended to limit the actions of Russia; although everything indicates that it will take an extended period, at a financial level, they are looking for strategies that allow avoiding the penalty measures.

Cryptocurrencies have many points in their favor; it is only a matter of evaluating them and making use of them promptly, always seeking individual and collective benefit; that is where the most significant importance of these financial tools lies.