Russia will buy Bitcoin to avoid US sanctions, economist claims
According to a high-profile Moscow economist, Vladimir Putin's government is about to invest heavily in Bitcoin to circumvent US trade restrictions
A high-profile Moscow economist has reportedly said the Russian government is looking to invest in Bitcoin next month.
Australian crypto news website micky.com claims to have spoken with Vladislav Ginko, a lecturer at the Russian Presidential Academy of National Economy and Public Administration in Moscow.
“US sanctions may be mitigated only through Bitcoin use,” the site quoted Ginko as saying. “I believe that the Russia [government] will start diversifying its reserves with Bitcoin in February this year when US Congress will introduce… new sanctions against Russia,” he reportedly said.
Ginko estimated that the first wave of Russian investment in crypto could begin as early as February and could be worth billions and thinks the investment will come from both the state and private sector.
“Because of US sanctions Russia’s elite is forced to dump US assets and US dollars and invest hugely into Bitcoins.”
It won’t be the first time a country facing the economic wrath of Washington has turned to Bitcoin. Last year, Venezuela, North Korea and Iran all explored the use of cryptos to circumvent US sanctions.
Vladislav Ginko has previously given pro-crypto economic commentary on Russian state television and radio and, while this is just speculation currently, there do seem to have been links with the Kremlin and crypto projects in previous weeks.
President Vladimir Putin has said there is inherent instability in a dollar-dependent financial system and that this created a need for Moscow to consider alternative reserve currencies. Donald Trump’s repeated calls for “America first” have allegedly lexacerbated this feeling.
Like most governments, Russia has warned against the risk of investing in highly volatile assets but has not directly condemned Bitcoin unlike its neighbor, China, which considers crypto an independent financial axis of evil.
Links between Moscow and the Chinese blockchain platform Neo were reported in November, when a tie-up was requested between the Russian Association of Cryptocurrency and Blockchain and the NEO Competence Centre in Saint Petersburg “in accordance with the request of the President of the Russian Federation, Mr Vladimir Putin.”
NEO has been dubbed the ‘Chinese Ethereum’ as it provides a blockchain platform for decentralized applications, and this seems to indicate the possibility of Russia making deeper inroads into crypto.
Such a move could help reverse the year-long bear market as other nations are likely to follow suit in an effort to distance themselves from the dollar, as America heads down President Trump’s rigid economic road.
Bitcoin and crypto-currency markets are in desperate need for a boost, after the battered and bruised industry lost 85% of its value over the past year. Could anything be greater than a global power investing heavily into Bitcoin?