In the wake of the West’s sanctions imposed on Russia, the amount of ruble-denominated crypto trading volumes has begun to surge as a result.
In particular, the Russian ruble-to-Bitcoin (RUB/BTC) trading volumes reached a nine-month high as the country’s fiat currency fell to record lows in the aftermath of the invasion of Ukraine, according to a CoinDesk report citing data tracked by Kaiko.
Indeed, as the sanctions were placed on Russia’s central bank, the country’s ruble fell to an all-time low Monday, February 28. On February 24, the RUB-denominated Bitcoin volume reached approximately 1.5 billion RUB, the highest level since May 2021, as investors hurried to get their money out of the ruble in anticipation of stricter sanctions.
Kaiko’s research analyst Clara Medalie revealed:
“The activity was concentrated on Binance. Bitcoin-Ukrainian hryvnia volume has also spiked, but not as high as October levels. BTC-UAH only trades on 2 exchanges – Binance and LocalBitcoin.”
Russian investors also looking to Tether
Whatsmore, Medalie went on to say that similar patterns were noticed in the trading volumes of Tether (USDT) against the ruble and Tether against the Hryvnia.
In the frequently turbulent world of cryptocurrencies, Tether, the world’s biggest stablecoin in terms of market capitalization, provides the unique characteristic of price stability by maintaining a 1:1 peg with the United States dollar.
Meanwhile, in a move that took place over the weekend, the West escalated its targeted sanctions against Russia, intending to prevent Russian banks from accessing the Society for Worldwide Interbank Financial Telecommunication (SWIFT), the communications network that underpins global financial transactions.
Furthermore, the European Union has prohibited any transactions with the Russian central bank to prevent the bank from selling offshore assets to bolster its domestic banks.
Consequently, Russia’s national currency has crashed to a record low, with 1 ruble now worth $0.0094.
The rush to safety has benefited gold, U.S. treasuries, the U.S. dollar, and the Swiss franc, among other assets.
After the rouble plummeted to a historic low, Russia raised its key interest rate to 20% following the imposition of heavy financial sanctions by Western nations, putting Russia’s banking sector is under significant strain.