Key takeaways:
- Visa and Mastercard have joined the long list of companies that are refusing to do business with Russian banks
- Prominent hedge fund manager Mark Mobius believes crypto is rallying due to Russians using Bitcoin and crypto to circumvent sanctions
- Bitcoin is now up close to 30% since last Thursday’s lows
Economic sanctions against Russian banks are getting harsher by the day
In light of strict and extensive economic sanctions enforced against Russian financial institutions, global payments giants Visa and Mastercard have now joined the list of companies refusing to provide their services to Russian banks.
According to CNBC, Both Visa and Mastercard have decided to adhere to a sanctions list put together by the US officials last week. The news comes only days after the US and its allies agreed to remove Russian banks from SWIFT, the global interbank messaging system, and employed unprecedented sanctions on Russia’s central bank.
The cumulative effect of sanctions placed on the Russian economy has caused the price of rubble to drop to its multi-decade low and the leading Russian MOEX stock index to drop by 30% last week. As of today, the country’s local stock trading remains closed for the third day in a row, its longest closure since 1998.
Crypto rallies despite economic uncertainty
The cryptocurrency markets have responded to the rising geopolitical instability by rallying in recent days. After initially mimicking the broader financial market last Thursday, on the day that Russia attacked Ukraine, Bitcoin and other digital assets have experienced notable bullish activity in subsequent days.
Last Friday, Bitcoin and Ethereum gained over 10%. After a relatively quiet weekend, the crypto rally continued on Tuesday, with the total market cap experiencing a nearly 10% increase in a single day.
Leading crypto exchange Binance is reportedly reluctant to block all Russian accounts, but will block those who were put on a sanctions list.
Talking about the rising crypto prices and economic sanctions, prominent hedge fund manager Mark Mobius told CNBC in an interview that he would be buying Bitcoin if he was a Russian. He added that Bitcoin’s recent impressive market performance is due to Russians transferring their wealth and money into digital assets.
