Despite constant claims to the contrary, crypto does not provide a way for Russians to avoid sanctions. But what lessons can we learn about cryptocurrency from the conflict in Ukraine?
With the concerns of Janet Yellen and Hillary Clinton notwithstanding, there isn’t enough cryptocurrency in the world to bail out Russia from the economic hole which it now finds itself to be settling into. Even if there were a large enough supply, it probably wouldn’t enable the state to escape the scourge of a Western embargo.
Digital currencies are simply not a good way for Russian oligarchs and sanctions-evading institutions to move money. “You’d be a fool to use Bitcoin if you were a bad actor,” added Le Merle. With the clustering technologies and analytics capacity that the U.S. government and other enforcement agencies have today, “They know how to come after you.”
More surprising, however, is how ineffective this might prove. “I don’t believe that the Russian government can rely on cryptocurrencies to offset sanctions’ impact,” Max Dilendorf, partner at the Dilendorf Law Firm, told Cointelegraph. “The economic impact caused by sanctions could run into hundreds of billions of dollars.” There probably isn’t enough Bitcoin or crypto in the world to mitigate economic damage of that magnitude, he said.
There is the matter of anonymity — or lack thereof, for instance. Moving commodities on a large global scale is bound to be noticed, said Parker. Then, too, there is crypto’s volatility. Are commodities traders prepared to lose 10% within hours in a commodities transaction because of crypto’s price gyrations? USD is the world’s de facto reserve currency for a reason — it is exceptionally stable.on individuals or entities for violating its sanctions rules in the past year, and “the minute the U.
Say a U.S. business has been using the services of a Russian software developer. The U.S. firm had been paying the developer through a series of bank transfers ending with Sberbank. Sberbank can no longer be used under the new sanctions regime, but the U.S. firm can still employ the Russian developer and pay that person in crypto. Parker further told Cointelegraph:
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