Brad Garlinghouse, the CEO of Ripple, has recently highlighted the reality of the role of XRP, crypto, and blockchain in evading global sanctions, such as the recent sanctions imposed on Russia by the West.
The West intends to prevent Russian banks from accessing the Society for Worldwide Interbank Financial Telecommunication (SWIFT), the communications network that strengthens financial transactions across the world.
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The round of sanctions recently imposed by the United States, European Union (EU), United Kingdom (UK), and Canada will eject Russia from SWIFT, which will, in turn, paralyze the assets of the central bank of Russia.
Brad Garlinghouse Discusses Crypto’s Role in Evading Global Sanctions
Due to the new development, Ruble-Bitcoin (RUB/BTC) volume hit a 9-month high, making many see crypto as Russians’ last resort.
This prompted Ripple CEO, Brad Garlinghouse, to discuss the reality of XRP, crypto, and blockchain’s role in evading global sanctions.
Read Also: Brad Garlinghouse Says the SEC Aided Ethereum to Overtake XRP as Second-Largest Crypto
In a tweet on 28th February, Garlinghouse wrote, “To clear any confusion – RippleNet (while being able to do much more than just messaging a la SWIFT) abides by international law & OFAC sanctions. Period, full stop.”
.@ashgoblue lays out the reality of crypto & blockchain’s role (or lack thereof) to evade global sanctions.
To clear any confusion – RippleNet (while being able to do much more than just messaging a la SWIFT) abides by international law & OFAC sanctions. Period, full stop. https://t.co/WmQC4sHcSa
— Brad Garlinghouse (@bgarlinghouse) February 28, 2022
Brad Garlinghouse’s response to the issue indicates that Ripple is maintaining its clear stand on the side of the law, both with its lawsuit with the SEC and the latest sanctions imposed on Russia.
To further explain why it would be impossible for Russia to get around international sanctions using crypto, Asheesh Birla, the GM of RippleNet, wrote, “Crypto is only becoming more easily trackable by software and governments. There simply isn’t enough global liquidity to support Russia’s needs (the country’s FX needs, not individuals). On/off ramps are by and large regulated financial institutions that have to abide by OFAC laws.”
Read Also: Brad Garlinghouse Says Ripple Would Settle with U.S. SEC on One Condition
According to Birla, Russia conducts about $50 billion in FX transactions a day, while Bitcoin’s volume per day is usually between $20 billion and $50 billion. So, Russia’s needs per day encompass Bitcoin’s daily volume.
He added that “As of January 2022, you could only send ~$200k worth of Russian rubles at a time through BTC on Binance, vs $3.7M through BTC/USD and $2.9M through BTC/EUR on Bitstamp.
“Even if you were sending ~$200K every minute & assuming the BTC/RUB market was resilient enough to immediately replenish the liquidity (very doubtful), you’re nowhere near $50B / day. Also, the total average daily volume over the last month for BTC/RUB has been just ~$11M…”
However, Birla concluded that Russia must have prepared before invading Ukraine, knowing fully well that the West will come with sanctions. But he believes that it would be impossible for Russia to rely on crypto, considering the daily volume and Russia’s daily needs.
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