Western allies have imposed several sanctions on Russia for its invasion of Ukraine and the rich people are trying to dodge the stranglehold on their money. Everyone is seeking cryptocurrencies.
The crypto segment looks like a blessing in evading sanctions. The transactions can be completed by being anonymous. It is worthless to store the money in worthless paper. The ruble is losing value against the United States dollar gradually.
Apart from the sanctions, the Russian stock market is put to a halt phase. It is not functioning. It is closed feature a complete collapse. Domestic prices are increasing and people are losing purchasing power. The basics including food are becoming expensive.
The Russian invasion of Ukraine started on February 24 and an uptrend in the cryptocurrency market was witnessed thereafter, just opposite to the decline since early November 2021. Data revealed people were moving their funds to cryptocurrencies fearing future devaluation of the ruble.
Meanwhile, German lawmaker has called the European Commission to find a way t close such loopholes in the Western sanctions. Evading sanctions with the help of cryptocurrency is a significant drawback.
The Bitcoin was priced 67,617 euros on November 9 and it was about half the value of late January. If the crypto market losses value, people believing the segment to be a safe haven may lose money. The crypto segment is not perfect to keep the money forever. The funds need to be cashed out in fiat or traditional currency at some point. Russians either require a bank or broker for the conversion and this may attract the attention of the West.
El Salvador is the only country in the world where cryptocurrency is a legal tender and can be used in making payments for everyday goods or services. No conversion to fiat or traditional currency is required.
Cryptocurrency is a digital currency and is only available through a computer network. It has no physical form like fiat or traditional currency. It works on blockchain technology. The ownership of crypto coins is recorded in a digital public ledger. Bitcoin was the first cryptocurrency and was launched in 2009.
Meanwhile, the International Court of Justice has asked Russia to cease military operations in Ukraine and simultaneously the United States has warned Moscow from using any chemical weapon in the war. It is learned Russia may use Chinese currency yuan from the Forex reserves amid several sanctions. The Western allies have banned importing oil from Russia and Russian banks have been removed from the SWIFT payment systems.