The volume of trades involving Rouble and Tether (as well as Bitcoin and other cryptocurrencies) have skyrocketed in the past few days, purportedly on account of Western economic sanctions sharply reducing the Rouble's value.
Rouble-driven trading pairs with Tether topped US$29.4 million, according to Arcane Research, which could be seen as attempts to evade sanctions, or a flight from the rouble by Russians seeking the safety of a US denominated product.
Data shows that rouble-driven Bitcoin trades topped US$16 million following the imposition of the sanctions. Arcane Research's Bendik Schei said:
Under the current market conditions, I'm not surprised to see investors, at least those in Russia, seeking stablecoins and not taking on the market risk of BTC. This is about saving their funds, not investing.
The United States and the United Kingdom have introduced unilateral sanctions targeting Russia's two largest banks, Sberbank and VTB, and placed personal sanctions on Russian Oligarchs and Putin himself.
The EU, in conjunction with the U.S. and UK, have agreed to remove a number of Russian financial institutions from the SWIFT banking system - the dominant global financial infrastructure permitting bank to bank transactions. Those Russian banks are now left with telephone, fax and telex if they wish to send funds abroad.
The cryptomarkets have been highlighted as a potential sanction busting technology, but given transactions are easily traceable (either to a Russian exchange or a privacy mixer) we would expect most western crypto-businesses to consider blocking transactions connected to sanctioned individuals.