Bitcoin: An Alternative to Mobilize Money in the Midst of War
Since the beginning of the conflict in Ukraine, cryptocurrency operations have tripled.
The war has fueled a trend to use Bitcoin after the sanctions imposed by the West on Russia.
Ukraine is benefiting from the anonymous donations it receives from around the world to keep up its fight against the Russian invaders.
The Russian invasion of Ukraine has made Bitcoin and other cryptocurrencies become a storage and exchange alternative for those who live in countries in conflict, as they allow money to be transferred anonymously and decentralized.
BTC has been able to regain some of the ground lost in recent weeks with the growth of trade in the ruble-denominated cryptocurrency in Russia.
Since the beginning of the invasion, inter-day transaction volume has been increasing by 259% on average to 1.3 billion rubles ($13.1 million), Reuters notes, citing data from CryptoCompare.
On the other hand, in Ukraine as well, daily cryptocurrency trading volume has tripled, according to crypto exchange Kuna to about 150 million hryvnias (about $5 million).
BTC usage grows in Eastern Europe
Experts have noted a growing trend in the use of Bitcoin for value transfer as a result of the war in Eastern Europe and sanctions imposed by Western powers on the Russian government, said Bea O’Carroll, managing director of the investment firm in Radkl digital assets.
“Basically, to have a currency that is not controlled by the government, that is not affected by emergency acts… is really interesting,” Radkl said. “Maybe this is how Russia gets its value moved around. Equally, on the other side, there was ‘this is how people are going to get value to the Ukrainians’.” she added.
Bitcoin has climbed 13% since Russia decided to invade its neighbor Ukraine. While the US S&P 500 index also rose about 2%, whilst gold, which is usually a traditional safe haven, only rose 3.5% in price on February 24 when the invasion began.
Nearly $300 million in short BTC positions were liquidated that day, according to data from Coinglass. QCP Capital, the Singapore-based digital assets trading firm, reported the removal of a large volume of “long leveraged positions”.
Russian oligarchs would be using cryptocurrencies
Digital assets offer the advantage to users in these countries of not being subject to the sanctions imposed after the announcement of the disconnection of the SWIFT system. Crypto storage and transactions are done from decentralized platforms that only the account holder has access to anywhere.
