Blocking Russian banks in ‘SWIFT’, what does it mean for the cryptocurrency industry?

Blocking Russian banks in ‘SWIFT’, what does it mean for the cryptocurrency industry?


Analysis of Crypto Potato, a media specialized in cryptocurrency

[Blockchain Today Correspondent Kim So-yeon] Cryptopotato, a media specializing in cryptocurrency, analyzed the impact of the ‘Russian bank SWIFT expulsion’ by the US, Canada, UK, and the European Commission (EU) on the cryptocurrency on the 26th (local time). time) was announced.

According to Cryptopotato, the White House has announced additional sanctions to completely exclude certain Russian banks from the SWIFT payment network. “This will cut off the banks from the international financial system and impair their ability to operate globally,” they said in a joint statement. ” explained the meaning.

Also, EU President Ursula von der Leyen said: “The plan is to prevent Russia’s emerging oligarchs from using their wealth in the EU market. will ultimately be a way to destroy the future of their own country,” he warned.

The International Association of Interbank Telecommunications (SWIFT) is the world’s largest financial electronic message processing system, used by more than 11,000 institutions worldwide. If Russia is excluded from the SWIFT payment network, the banks will block transactions and liquidity of funds with institutions within the system, which can be interpreted as a measure to isolate and punish Russia.

However, in this regard, there have been consistent analyzes that Russia has been studying SWIFT alternatives for quite some time. On the morning of the 27th (local time), Crypto Potato reported that “Russia has already chosen CIPS as an alternative,” citing an article in Asia Markets, an Asian economic newsletter.

CIPS is an acronym for Cross-Border Interbank Payments System, which refers to the RMB international payment system launched in 2015 led by the People’s Bank of China. In the Asian market, at least 23 Russian banks are already connected to CIPS.

Currently, China is said to have maintained an ambiguous position on Russia’s invasion of Ukraine. China has described itself as a ‘guardian of sovereign independence’, but on the other hand, it is still reluctant to criticize Russia’s actions.

So, what is the effect of a series of circumstances on cryptocurrency?

Cryptopotato predicts that if Russia decides to use cryptocurrency as an alternative to financial sanctions, it will put a huge burden on regulators in Western countries.

In the past year, cryptocurrency exchanges in various developed countries have made various efforts to evade sanctions by the authorities, and the authorities have been pushing for related laws to scrutinize cryptocurrencies. In this situation, if Russia chooses cryptocurrency as an alternative to financial sanctions, the regulatory environment for cryptocurrency in those countries could become more severe.

However, creating a strict regulatory environment is not necessarily a bad thing for the cryptocurrency market, as many cryptocurrency enthusiasts have been pushing for clear regulations.

In a podcast with Cryptopotato, Alex Hoeptner, CEO of cryptocurrency exchange BitMEX, said, “It would be wrong if authorities regulate cryptocurrencies and traditional financial assets the same, but rules are necessary for the future of the cryptocurrency industry. ” has claimed.

However, Crypto Potato argued that this is not necessarily good news, given that Western countries can be accused of helping Russia by using cryptocurrencies as a means of evading sanctions. Therefore, it is difficult to judge right now whether the ‘Russian financial sanctions’ will be positive or negative for cryptocurrencies, but one thing is certain: ‘We are facing tremendous uncertainty right now,’ the media added.

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