Ukraine: Will war be the reason for governments' global adoption of cryptocurrencies? How close are we to that?

The world is changing much faster than our senses perceive.

BlackRock CEO Larry Fink ( photo ) believes digital currencies, such as Bitcoin and other cryptocurrencies, could be used to settle international trade, as was the case during the Russia-Ukraine war, according to Reuters on March 24, 2022.

Fink said the war would force countries to reconsider their dependence on fiat currencies and adopt cryptocurrencies as an alternative in a letter to BlackRock shareholders.

 With the growing customer interest in digital currencies and stablecoins, BlackRock is also exploring their usefulness and benefits.

In addition, he believes that a well-designed payment system based on digital currencies will improve the current international trade settlement system. 

He said:

"A carefully designed global payment system can enhance the settlement of international transactions while reducing the risk of money laundering."

In response to the Russian invasion of Ukraine, BlackRock suspended the purchase of Russian bonds in its portfolios, blocking the flow of funds to Russia and investments in Russia.

According to BlackRock, its total customer exposure in Russia fell from $ 18 billion to less than $ 1 billion amid the war, Western sanctions, and the closure of the Russian stock market.

Increased adoption of crypto during the Russia-Ukraine war

The Russia-Ukraine conflict has led to a global supply chain disruption, rising inflation pushing countries to tighten their monetary policy, and increasing energy and oil prices. 

However, it accelerated the adoption of cryptocurrencies as cryptocurrency prices rose higher, with Bitcoin exceeding $ 43,500. 

Digital currencies such as Bitcoin are considered inflation hedging and storing value.

The growing adoption of cryptocurrencies has led to their use for international transactions.

 Russia has been using digital currencies to circumvent sanctions, as Ukraine has been asking for crypto donations.

Opinion

We face global reshuffles even in world currencies and what we still call reserve currency and monetary security.

There are always upheavals when significant, historical, and global changes occur.

So it is good to be very cautious in what is read and what decisions you make shortly.

Especially when there is no historical precedent, such as cryptocurrencies.

Billy Kasis, blog writer. 

"Greed is more opposed to economics than generosity."

La Rosfoucauld, 1613-1680, French writer.

Billy Kasis, Cryptocurrencies blog writer.