Russians turn to crypto to evade restrictions

Bitcoin (BTC/USD) is trading just above the $20k mark after another sell-off. This latest dip follows a broader market reaction to Federal Reserve Chairman Jerome Powell’s monetary policy remarks at Friday’s Jackson Hole economic forum. While anticipated, Powell’s confirmation at the symposium that the central bank would stick to its hawkish approach to inflation, plunged risk-on sentiment and saw Wall Street and crypto prices fall sharply.

With BTC at around $20,250 and as markets continue to digest the Fed Chair’s remarks, it remains to be seen if Bitcoin can keep the psychological support zone. If that breaks, more pain could involve a retest of mid-June price levels.

Even as crypto struggles through the bear market, adoption in Russia is picking momentum. It’s an observation from the perspective of more people turning to cryptocurrencies to try evade biting restrictions on foreign exchange. Indeed, a recent survey revealed that nearly a third of respondents said they were planning to buy crypto over the next six months.

Marcus Sotiriou, an analyst at UK-based digital assets firm GlobalBlock, says that crypto adoption in Russia is largely being catalysed by the currency restrictions imposed by Russian authorities.

The restrictions, enforced since early 2022 following Vladmir Putin’s invasion of Ukraine that attracted western sanctions, have hurt the ruble. And it’s these restrictions that are pushing more people towards crypto, he added in comments shared with CoinJournal via email.

This is “despite there being no legal way to buy or sell cryptocurrencies in Russia right now,” he noted, commenting on how difficult it is for those looking to use crypto to circumvent the restrictions.

However, while that is the case for many users, platforms that offer over-the-counter (OTC) crypto exchange services are reportedly providing an easy way to buy crypto with the local currency.

The assets are then liquidated for foreign currency in countries like the United Arab Emirates (UAE) and Georgia.

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