In June, the actions of the private military company Wagner Group sparked a significant shift in cryptocurrency markets. An upheaval in Russia prompted a massive 277% surge in trades between the stablecoin Tether (USDT) and the Russian fiat currency on the eve of Wagner’s rebellion. The fluctuation displayed the power of crypto in serving as a safe haven amid political instability.
The hike in revenue was a reaction to the depreciating Russian ruble and the haphazard state of Russian power structures during Wagner’s attempted takeover. Data from CCData illustrates how the USDT/RUB pair rocketed to $14.7 million on June 24, from just $3.9 million the previous day. Even though the swell was short-lived, falling below $3 million the following day after Prigozhin, the commander of Wagner, called his troops back to the base, the considerable spike is noteworthy.
And where else to see this remarkable fluctuation than on the Binance graph, indicating a high of $8.5 million in volume on that particular day. As the only major international platform trading Tether against the ruble, Binance’s contributions were substantial, along with those from other smaller exchanges tailored for Russian traders.
Tether’s surge paralleled a mass exodus of local capital, with Russians withdrawing over $1 billion from domestic banks, a sign of shaken confidence in the local economy. The Russian ruble, having endured a 30% plummet against the US dollar since December, reached its lowest stance amid the ongoing conflict in Ukraine.
This sudden interest in Tether is not an isolated incident. In February and March of 2022, there was a surge in Tether and Bitcoin trading volumes from both Russian and Ukrainian traders when the war in Ukraine erupted. This recurrence underlines cryptocurrency’s role as a buffer during uncertain and turbulent times.
However, the circumstance presents a paradox. While digital assets offer an essential resource as safe harbors during geopolitical unrest, the explosive volatility questions the consistency and reliability of cryptocurrencies as a secure alternative.
While Tether’s surge showcases the potential cryptos hold in economically disrupted environments, it also underscores the persistent doubts surrounding digital currencies. Protecting versus endangering wealth — the balance fluctuates, leaving us watching the space attentively.
Source: Cryptonews
