Recently, Ukraine has asked “sabotageof crypto assets from everyday Russians due to an ongoing war between the two countries. Among many, their European allies have also expressed growing concern that Russia may use crypto to circumvent Western sanctions.

But ironically, it seems that one of the biggest proponents of banning Russians and ordinary financial institutions from cryptocurrencies is actually the Central Bank of Russia, or CBR, itself. As local media outlet reported on Thursday, the CBR continues to adhere to its position of proposing to ban the issuance, mining, and circulation of cryptocurrencies in the Russian Federation. A CBR official stated:

“The Central Bank currently supports the position that was previously announced and published on the official website. Therefore, there is nothing to add today.”

During times of war, nations generally need to drastically increase their spending, for example by printing new money, to finance their military efforts. However, this leads to rampant inflation, prompting people to exchange their local currencies for foreign currencies (now including cryptocurrencies) to protect their savings.

But this, in turn, would create strong selling pressure on the local currency, driving up exchange rates and hampering war financing efforts. As a result, countries often introduce strict currency controls during times of war, as Russia and Ukraine have already done. Thus, the drawbacks of cryptocurrencies destabilizing the ruble and, by proxy, crippling Russia’s war efforts, could outweigh the benefits of using cryptocurrencies to evade sanctions.

According to a report released by Arcane Research this week, daily Tether (USDT) to ruble trading volume on Binance hit an all-time high of $35 million. Russian social media members seem to be deeply concerned about the falling value of the ruble and how cryptocurrencies can help them protect their savings. User Roman Buchyn wrote:

“You have to buy something [cryptocurrencies]; the ruble will soon be cheaper than toilet paper.”

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