Bitcoin proves sanction breaker for Russia

Russia issues digital asset license to Sberbank

The Central Bank of Russia, or CBR, reevaluated its policy less than two weeks after reiterating its proposal to ban the issuance, mining, and circulation of cryptocurrencies in Russia. The CBR added the country’s largest lender, Sberbank, to its register of information system operators for digital financial assets.

Sberbank legal entities will soon be able to issue digital financial statements certifying monetary claims, acquire digital assets allocated in the Sberbank system, and conduct crypto transactions.

Sberbank exited almost all European markets earlier this month due to European Union sanctions. Simultaneously, its foreign depository shares have dropped by more than 99 percent on the London Stock Exchange, with trading halted and the last quoted price of $0.05 per share.

The devastating sanctions imposed on Sberbank and the CBR’s apparent policy reversal on crypto have fueled speculation that digital currencies could be a “lifeline” for the troubled bank. On the other hand, experts do not believe that sanctioned financial institutions can use cryptocurrency to avoid sanctions.

Bitcoin price

The majority of people are now wondering what the real reason is. So, the first reason for this massive decline in bitcoin value is policy changes by the US Federal Reserve. Bitcoin’s value has fallen as a result of the fiscally conservative changes. Another primary reason is that bitcoin has gained widespread acceptance and has become a trustworthy option for many. As a result, the demand for bitcoin increases, but its value decreases over time. The price of bitcoin fluctuates as much as the price of stocks.

Bitcoin fell slightly on Friday, March 18, amid volatile markets as Russia-Ukraine tensions remained high for the second month. The world’s largest cryptocurrency by market value fell 0.02 percent in the last 24 hours to $40,755.47. It should note that Bitcoin has gained nearly 5% in the last seven days.

Ether, the second most popular cryptocurrency, increased 1.64 percent in a single day to $2,798.10. Ether gained more than 8% in a single week.

Bitcoin has fallen below the $40,000 mark as the Ukraine-Russia conflict has escalated in the last month. On the other hand, Gold has risen to its highest level since June of last year. Analysts have previously stated that Bitcoin may fall further, falling below $30,000, as traders expected to favor Gold now.

To combat rising inflation, the US Federal Reserve raised interest rates for the first time since 2018, from 0.25 percent to 0.5 percent. In most cases, rising interest rates signal uncertainty for the cryptocurrency market because investors have greater access to yield from low-risk market avenues.

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