Never before have cryptocurrencies played such an important role in a war situation. But there is also a lot of dilemma about which nation stands to benefit more, Ukraine or Russia.
Cryptocurrencies play an important role in the war between Russia and Ukraine. Cryptocurrencies are an opportunity for the people of Ukraine to carry out payment transactions despite the collapse of the infrastructure, to receive fast international donations and to safeguard their own assets in the event of a Russian occupation. Crypto currencies can be of great help to those in need, but probably to oligarchs as well.
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Russian Oligarchs Transfer All Their Assets To Crypto Due To Sanctions
Due to the war, the foreign assets of wealthy Russians were frozen. Russia is also excluded from the banking communications network, Swift. Therefore, the flow of money to and from Russia is severely restricted, but cryptocurrencies are not affected by this ban. Therefore, they remain an option for keeping funds safe or making payments. Cryptocurrencies are particularly widespread in Russia, and, according to broker chart, some Russian oligarchs have already tried to transfer at least part of their assets to Bitcoin.
Crypto exchanges are also required to freeze sanctioned assets
In the current crisis, the United States is concentrating on existing sanctions. For example, if you want to exchange rubles for Bitcoin, Ether or Litecoin, you need a trading platform, a so-called crypto exchange. Here, for example, you can find out about how bitpanda works. With a platform like Bitpanda you can carry out various types of operations: investments in assets such as stocks, metals and ETFs.
Operators, like banks, have to comply with existing sanctions. They also blocked the accounts of the sanctioned people. But it is debatable whether that is enough to really hurt the powerful and wealthy in Russia.
Crypto donations are vital for Ukraine
On the other hand, digital payment channels are a boon for Ukraine, because the attacked country now receives cryptocurrency donations in the millions. So far it is already more than 40 million euros, and this regardless of the question of whether the Ukrainian banks can still function. After all, it is the nature of cryptocurrencies that intermediaries like banks are not needed to transfer payments from A to B.
It is the first time that a government raises funds in cryptocurrencies. Therefore, an Internet wallet was created for this occasion in a very short space of time. Which now helps in a very considerable way to buy everything that is now urgently needed: medicine and food, but also drones or helmets for soldiers.
Conclusions
There is no doubt that everything must be done to make the financial sanctions against Russia as severe as possible. However, for crypto advocates there is no escaping this problem and they must face criticism.
Even if Russia tried to circumvent sanctions with Bitcoin, for example, it would run into the problem that it would only be able to do limited business with the West. Most of the oligarchs who have transferred to Bitcoin in recent days are also in the sights of the judicial authorities, since Bitcoin operations, especially large sums of money, can be traced, with the money most likely coming from Russian rich.
Fortunately, there are numerous examples of the positive impact of cryptocurrencies in Ukraine. In this sense, balanced information is to be expected that does not put cryptocurrencies under general suspicion.
