Bitcoin overtakes flatlining rouble as a more valuable currency as Russia sanctions bite
The total market value of Bitcoin has overtaken that of the plummeting Russian rouble, as speculation is growing that the digital coin and other cryptocurrencies could help Moscow cushion the blow of international sanctions.
Russia's invasion of Ukraine has sparked a slew of economic sanctions from governments around the world, sending the Russian currency plunging to record lows and raising the spectre of hyperinflation.
Meanwhile crypto trading has risen, with Ukraine calling for donations in digital currencies to back its war effort, and raising more than $20 million (€18 million) so far, according to the blockchain analysis firm Elliptic.
As of Tuesday, the market capitalisation of Bitcoin worldwide now exceeds that of the rouble, according to data from CoinMarketCap.
The Russian currency is currently ranked 17th in market value, behind the Thai baht and the Mexican peso.
Western allies have sought to punish Russia for its attack with harsh financial sanctions, excluding some Russian banks from the SWIFT international payments system and freezing Russia’s central bank reserves.
The sanctions have caused the rouble to plunge to record lows against the dollar, and sent Russian people queuing outside banks to withdraw cash.
As the value of the rouble tumbles and the risk of hyperinflation grows, the Russian central bank moved to raise its key interest rate to 20 per cent on Monday.
As more Russians may now be tempted to convert their money into cryptocurrencies, Ukrainian officials have called on crypto exchanges to block Russian users and freeze assets linked to them.
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