Bitcoin has gained momentum in local currency transactions in Russia and Ukraine amid intense fighting and sweeping sanctions that have pushed the Russian ruble to a record low. Trading volumes in Bitcoin using the ruble have reached the highest level since May, while trading volumes in the Ukrainian hryvnia have risen to a level not seen since October, according to the crypto data company Kaiko.
Kaiko's head of research, Clara Medalie, stated, "This trend follows a wave of sanctions against Russia that disrupted forex markets and caused the ruble to drop to record lows against the dollar," as reported by Bloomberg and reviewed by Al Arabiya.net. The uncertainty surrounding Moscow's invasion of Ukraine has overshadowed global markets and led to a flight to safe-haven assets.
This comes despite a decline in the perception of Bitcoin as "digital gold" in recent months, as the relationship between the world's largest cryptocurrency and the U.S. stock market has grown. However, it remains true—through the Bitcoin surge fueled by the Turkish lira crisis—that some still prefer Bitcoin in unpredictable times.
Medalie noted that the total trading volume of Bitcoin also saw an increase during price fluctuations last week, but the increased activity in the Bitcoin/ruble and Bitcoin/hryvnia trading pairs was "much larger" than that in the Bitcoin/dollar trading pair.
Volumes on cryptocurrency exchanges trading the Russian ruble/US dollar pair have seen a 121% weekly increase, according to CoinShares data. It is unclear whether the increased volume indicates further "buying" interest from the two countries. Nevertheless, Medalie suggested that the divergence from other currency pairs including the dollar and euro in the past five days indicates that Bitcoin may be more attractive in these markets.
The Binance platform, which saw the highest number of trades between the ruble and Bitcoin on its exchange, confirmed that it would ban accounts targeted by sanctions but would not "unilaterally freeze" millions of user accounts in the country.
