People outside the dollar/euro zone have a better understanding of fiat money vulnerabilities, for they experienced it on their own skin – and often the hard way.
The Russians are well aware of how unstable the rouble is, so when Covid hit the world economy, their first reaction was to massively withdraw their money from bank accounts – a normal reaction of people who saw the whole banking system collapse (and not once).
The curious thing is that now, when the economy seems to restart, they are not in a hurry to put the withdrawn money back into banks (some $36M are missing, as estimated by the Bank of Russia).
Where did this money go? Quite naturally, we think of crypto. Russia is ranked in the top-20 in Chainalysis’ Global Crypto Adoption Index, and numerous surveys show Russian invertors’ growing interest in crypto, despite (and sometimes maybe because of) Central Bank’s negative stance towards it.
This interest was, quite unexpectedly, backed by President Putin, who in his yesterday’s interview at CNBC mentioned that cryptocurrencies do have value and exist as a means of payment, although they cannot yet replace dollars in settling oil trades.
Overall it’s good news for Russian crypto holders and businesses, as the President’s words weigh a lot in the country.