In the middle of the current gains and volatility, Bitcoin is now has a higher market cap than the Ruble, the Russian currency that reduced under the burden of sanctions from the West that was placed on Russia over the Ukrainian invasion. This happened after Putin, the President of Russia began a military operation in the country. You can visit here if you want to know why everybody rushing to buy Bitcoin.
Bitcoin overtook the Ruble in terms of total value as the price of Bitcoin surged just when the Russian currency went into free fall. Data showed that it has surpassed it for the first in the fiat currencies worldwide ranking by BTC’s market value because Bitcoin is ranked 14th and Ruble 17th in that list.
Volumes of trading in Bitcoin using Russia’s Ruble surged since May to the highest level and it suggested that the Russians are moving all their money potentially into cryptocurrency as the currency plunges to a low in the middle of the war between Russia and Ukraine.
Where this demand is arriving from?
- The uber-rich Russians who began the war are now using Bitcoin for sidestepping sanctions as they require money to constantly wage war.
- The normal people living in Russia, as well as Ukraine, also started to pile into Bitcoin for sidestepping sanctions as they require money for living or maybe because they wish to preserve little wealth.
- Between these two, the latter is more possible than the former.
- Some reports suggest that masses may be piling into Bitcoin for preserving wealth as countries are going to war.
- The transparent ledger of Bitcoin will never do any favor to the government of Putin to avoid sanctions.
- This is a global asset and so we need to check the data.
Check out what the data says
- The Ukrainian Hryvnia did not lose a lot of value in terms of the U.S dollar like the Ruble.
- As per the data, Bitcoin traded at a premium of 6% to USD on the Ukrainian Hryvnia market of Binance following the invasion of Russia on Ukraine on 24th February.
- It suggests a huge demand surge.
- More data from Binance indicates the Bitcoin or Ruble trading pair volume spike a lot over 240 % more than the 1 month trailing average in Ruble terms on 28th February and over 400 % on 24th February.
- Remember these two points, it is suggested to check out the types of holders of Bitcoin that may be emerging to find out if there are any new holders or anything different.
- Former CoinDesker, Noelle Acheson shared a tweet thread. It outlined the exercise that many people in this industry faced through the last few weeks.
- Firstly we need to consider the total Bitcoin addresses holding greater than or equal to$1.
- There has been an uptick from 27th February to 1st March from 34,564,788 to 35,035,127.
- Over the same time, the total Bitcoin addresses holding greater than 1000 Bitcoin also moved up from 2121 to 2257.
- This general growth in Bitcoin addresses supports such an idea of regular people investing in Bitcoin, this addresses growth with greater than 1000 Bitcoin or $40 million is not supporting it.
- According to Glassnode’s most current chart on 27th February, any smallholders were seen to be most aggressive to accumulate Bitcoin.
- Thus regular people are investing in Bitcoin. But the increase in the larger addresses amount needs more explanation.
- The total Bitcoin that was held in such addresses declines and it suggested that it can more likely be some case of reshuffling of exchange wallet.
- The Bitcoiners believed something for a long time. Everything supports it.
- Bitcoin is not used for now to avoid any sanction by warmongers. Rather it is used by normal people with the hope of preserving wealth as the war rages on.
- Yet there is no consensus.
- Analysts of Citigroup mentioned something and cited a chart that showed purchases of Bitcoin in Ruble rising in Bitcoin terms to almost 450 Bitcoin.
The volumes of Russian are relatively small till now. It suggested that the action of price is mainly because of investors positioning for some expected uptick in any demand from the country instead of only Russian demand. Individuals prefer to make money even during times of tragedy. Lastly, it can only be traders taking their positions in increased demand anticipation.
Interesting related article: