Ban on SWIFT – Rise of Crypto in RUSSIA

Sanctions on ‘Swift’, which was part of an economic embargo imposed to financially damage Russia’s invasion of Ukraine, is having a major impact on that country. Russia's ruble exchange rate fell sharply against the US dollar on Monday, following the boycott of several Russian banks by the Swift (Society for Worldwide Interbank Financial Telecommunications). It fell nearly 30 percent to a record low of 105. The Russian central bank has stepped in to bolster the depreciating ruble. Raised the key interest rate from 9.5 per cent to 20 per cent. Western nations have decided to freeze Russia from consuming its foreign currency reserves.

The decision is expected to affect Russia's $ 640 billion in currency reserves and jeopardize economic stability. It seems that Russia's central bank has decided to raise interest rates to protect itself from this risk. European officials estimate that sanctions could affect at least half of Russia's forex reserves. The Central Bank has taken further steps to combat the crisis. It is sending more money into the system and easing the rules on banking operations. Expatriate Russians and foreign companies were temporarily banned from selling government debt securities. The U.S. Treasury Department on Monday announced more new sanctions targeting Russian central bank and state investment funds.

Officials said Germany, France, the UK, Italy, Japan, the European Union and other countries would also join in targeting the Russian central bank. Russia's Finance Minister Rishi Sunak has announced further sanctions targeting Russia's central bank. When western nations increase sanctions against Russia one after other, Russia is looking towards Crypro. The nation might use cryptocurrency to evade or minimize sanctions. Russia wants to utilize it’s energy for crypto mining to generate assets and convert them into cash and for trading. World’s largest Crypto exchange Binance said that it will not block accounts of innocent users as per Ukraine request. As per the government report, 12 million Russian people are using crypto wallets trading 2 trillion rubles which is equivalent to $23.9 billion.