Bitcoin has experienced a surge following Russia’s invasion of Ukraine, with citizens turning to cryptocurrency to store and move money. The Russia
Bitcoin has experienced a surge following Russia’s invasion of Ukraine, with citizens turning to cryptocurrency to store and move money.
The Russian rouble has tanked to record lows as sanctions apply a squeeze to the country’s economy, and people are viewing crypto as a store of value.
Data collected by CryptoCompare, a cryptocurrency market data provider, said that Bitcoin trading denominated in the rouble rose by 259% to US$13.1mln on Thursday, the first day of the attacks.
Bea O’Carroll, a managing director at Radkl, a digital asset investment firm told Reuters that the war has seen Bitcoin being used to transfer value, adding “having a currency that is not controlled by the government, that is not affected by the emergency acts is really interesting.”
Bitcoin has climbed 13% since the first day of the invasion to US$43,000, compared to the 2% experienced by the S&P 500 US stock index that it has increasingly mirrored over the last year or so.
Gold, often viewed as a traditional store of value, is largely flat after rising 3.5% over the first few days of the invasion, nearly pushing past US$2,000 at one point.
The anonymity given by Bitcoin may also prove to be a haven for oligarchs who are being hit by sanctions imposed by NATO.
“Bitcoin could be a potential safe haven for Russian oligarchs avoiding sanctions as there will be no censor on the Bitcoin network and on cryptocurrency transactions,” said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
On the flip side, Ukraine has turned to cryptocurrency to help aid its efforts in resisting Russia.
Vice-president Mykhailo Fedorov tweeted the addresses of Bitcoin and Ethereum wallets, adding Ukraine is “now accepting cryptocurrency donations.”
Elliptic, a blockchain analysis company, said the country has raised over US$22mln in cryptocurrencies as a result.
www.proactiveinvestors.com