In all the talk of what countries will do in response to Russia’s invasion of Ukraine, a key move is mentioned every time: sanctions. The idea is pretty basic. Stop doing business with a country, freeze their assets, and stop goods from going in. It’s an economic way to turn the screws. But, living in the 21st century means Russia is ready. Emily Flitter and David Yaffe-Bellany at the New York Times have more about the Digital Ruble.
Should it choose to evade sanctions, Russia has multiple cryptocurrency-related tools at its disposal, experts said. All it needs is to find ways to trade without touching the dollar.NY Times
The Russian government is developing its own central bank digital currency, a so-called digital ruble that it hopes to use to trade directly with other countries willing to accept it without first converting it into dollars. Hacking techniques like ransomware could help Russians steal digital currencies and make up revenue lost to sanctions.
While it is true that Russia will instantly have a short list of countries that will do business with it, it is not zero. Countries that have been sympathetic will continue to trade and, more importantly, can opt to do business using cryptocurrency. Whether Russia uses bitcoin, Ethereum, or their home-grown digital ruble, it gives them a huge way around the freezing of assets that rely on a global banking system.
None of this is outside the realm of possibility. Flitter and Yaffe-Bellany’s reporting goes on to state that North Korea has done this to get around sanctions. They also have used ransomware to steal crypto in order to fill their coffers. This is all to say that we live in the digital age. The way countries promote and punish one another has to change with the times. While it is good that peaceful tools such as sanctions exist, it seems that it needs to evolve in order to achieve its intended goal.