Russian Crypto Volume On Major Exchanges Falls 50%

Data from blockchain analytics firms shows purchases and trades of Russian-denominated crypto on major exchanges have failed, debunking theories that the country will turn to digital assets to circumvent sanctions.

When Bitcoin rose more than 15% last week, some industry experts attributed the surge to Russians buying cryptocurrency in the face of increased economic sanctions. However, this theory appears to have been proven wrong, as data from Chainalysis showed that ruble-denominated crypto trading volume was just $34.1 million on March 3, about half of a recent peaked at $70.7 million a week ago on February 24.

Speaking on the issue of sanctions-fueled crypto buying to Bloomberg, Citigroup analyst Alexander Saunders said, “Russian volumes have been relatively weak so far, suggesting price action is more due to investor positioning for an expected increase in demand from Russia, rather than Russian demand itself.

Although experts reject the idea that crypto could be used to help Russia circumvent economic sanctions, the United States and the EU continue to tighten their regulatory control of digital assets.

Recently, New York State has increased its blockchain surveillance capabilities to further prevent the use of cryptocurrencies or digital assets to support Russian interests.

New York Governor Kathy Hochul issued an executive order on Feb. 27 ordering state agencies to divest from Russian institutions and businesses, as well as entities that provide support to them. She says:

“New York is proudly home to the largest Ukrainian population in the country and we will use our technological assets to protect our people and show Russia that we will hold them accountable.”

Highlighting the other side of the story, Jake Chervinsky, policy officer for the Blockchain Association in the United States, went so far as to call these concerns about crypto “totally unfounded”.

Echoing this sentiment, Ari Redbord, Head of Legal and Government Affairs at crypto crime investigator TRM Labs, said it was too late for crypto assets to provide sufficient liquidity to Russia and that the public nature of blockchains is already a sufficient deterrent. for those seeking to circumvent sanctions.

“Russia cannot use cryptography to replace the hundreds of billions of dollars that could potentially be locked or frozen.”

Related: The European Commission will remove Russian banks from the cross-border SWIFT network

Faced with impending regulatory action from the international community, many of the world’s leading crypto exchanges have moved to blacklist sanctioned individuals and organizations. Binance, however, refused requests to censor “innocent” Russian customer accounts.

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Russian Crypto Volume On Major Exchanges Falls 50%

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