Why do Russian citizens try to find comfort in cryptocurrency trading?
If we visit similarweb.com and look at traffic by countries for Binance, which is one of the biggest cryptocurrency exchanges, we will see the following picture:
Russia is at the top. Why?
Instability of the Russian economy allegedly isn’t the less important factor among the others. Let’s recall all currency crises in Russia for the last 25 years (we exclude the depreciation of the national currency of the Soviet Union — when millions of people lost their savings that had been collected for years — from the list, counting it as another period).
- The devaluation of ruble that took place on October 11, 1994, known as Russia’s Black Tuesday.
Overnight, the rate of dollar soared from 3081 to 3926 rubles on the Moscow Interbank Currency Exchange. Lack of coordination, lack of timeliness, and incompetent decisions and actions of the federal authorities were listed as the reasons for it.
- Ruble crisis of 1998
On August 17, 1998, a technical default was announced. As a result of it, the ruble faced a three-fold decrease (from 6 rubles for a dollar before the default to 21 rubles on January 1, 1999). The first sovereign default in history had led to the extremely high inflation rate and the decrease of the population’s standard of living.
- The 2008 financial crisis
The general economic decline of the world markets in 2008 was especially painful for Russia, which was dependent on oil export.
The sharp decline of oil prices up to $40 per barrel resulted in a massive recession: the unemployment surged, the devaluation of the national currency began. The war with Georgia had exacerbated the situation, and the decrease of the GDP became the record-breaking 7.9%.
- Russian financial crisis of 2014–2015
The geopolitical reasons (The Ukraine crisis and annexation of Crimea) had led to large-scale economic sanctions and blocking access to international funds, which toughen the situation for Russian banks.
The ruble fell in the value against the US dollar, which resulted in inflation growth, a decrease of consumer demand, an economic downturn, an increase in poverty, and a decline in the real income of the population. The Russian economy has not yet exited the crisis.
It’s no surprise that against the background of the succession of economic crises and spreading rumors about a new upcoming global one, the number of Russian citizens searching for a way to preserve and consolidate their funds with the help of promising and reliable economical instruments has been growing, trying to avoid the state financial system, whose declines are the harshest to common people.
Cryptocurrency markets are becoming the platform, which enables people from countries with less stable economies not only to preserve their income but also to increase their capital with the help of the right trade strategies.
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