Rouble-crypto Tradings Soar as Russian Currency Drops to a Record Low
In the wake of the ongoing war, the Russian rouble takes a sharp fall as many make the switch from currency to cryptocurrency.
Amid the ongoing conflict between Russia and Ukraine, the month of February ended with the local currency—the Russian rouble—tumbling to a record low. This was followed by a sharp increase in trading between the Russian rouble and the Tether cryptocurrency, according to a report from Reuters.
With rouble-dominated trades hitting $29.4 million, this is, according to Oslo-based digital asset researcher Arcane Research, the highest record this year and around 3 times more than a week earlier, too!
Cryptocurrency in Russia
Tethers is a so-called stablecoin—a type of cryptocurrency that’s designed to avoid the wild fluctuations that plague bitcoin. Theoretically, its stable value allows users to protect their funds and savings, especially during economic stress.
And if anything, these figures suggest a growing interest in cryptocurrency among Russians. This happened right after the local currency took a huge hit from the Western sanctions that were imposed on Moscow for its invasion of Ukraine, which included blocking banks from the SWIFT global payments system.
In fact, the Russian rouble lost a third of its value so far this year and has even reached a record low in volatile trading last Monday. On the other hand, rouble-bitcoin trading last Thursday topped $16 million (around PHP 824.3 million)—its highest this year—as Russia launched its invasion. And last Monday, it totaled about $8.5 million (around PHP437.9 million).
“People with the rouble are trying to get out of it due to the drastic devaluation after all the sanctions,” explains Arcane’s Bendik Norheim Schei. “Under the current market conditions, I’m not surprised to see investors, at least those in Russia, seeking stablecoins and not taking on the market risk of [bitcoin] BTC. This is about saving their funds, not investing.”
If anything, data showed that trade between the rouble and bitcoin—whose 13-year history showed wild price swings—has now become more muted.