Bitcoin Rises As Ruble Tanks

Bitcoin is trading over $40K once again as its decentralized nature creates a potential safe haven.

Reviewed by: Jessica Ferringer
Edited by: Jessica Ferringer

After a disappointing start to the year, the price of bitcoin and other cryptocurrencies has rallied over the past week. Though bitcoin has fallen by nearly 4% over the trailing 24 hours, it is still up over 12% over the trailing week, trading above the $40K mark after dipping below $35K at the end of February.



Bitcoin still remains well below its all-time high of nearly $69K, which had been reached last November as crypto enthusiasm reached a fever pitch on the enthusiasm around the first bitcoin futures ETF launch.

But the recent enthusiasm comes amid an overall drop in equities, as the Russia-Ukraine conflict has caused markets to stumble, particularly tech and growth names that the cryptocurrency has, at times, exhibited a high correlation to.

Some speculate that current sentiment is driven by Russians converting their cash to bitcoin. Bloomberg has reported that trading volumes in bitcoin using the ruble are at their highest level since May.

This news comes against the backdrop of economic sanctions that have restricted Russian citizens access to foreign money while the value of their currency, the ruble, has tanked.

The Department of Justice has announced a new task force that will assist in enforcing sanctions, including by tracing cryptocurrency transactions. This news comes as many cryptocurrency exchanges such as Binance and Kraken have refused to ban Russian users.

The situation highlights what many have long seen as one of the key benefits of cryptocurrency—its decentralized nature.

However, that is often overshadowed by its appeal as a speculative investment that offers the potential for outsized gains.

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Friday at 4 a.m., the NYSE Arca brought trading of the iShares MSCI Russia ETF (ERUS) to a halt. The reasons cited were its exposure to the Russian market, MSCI’s removal of Russian stocks from its indexes and the closure of Russia’s stock market, according to a press release.

iShares had already halted creations for the fund as of March 1.

The $124 million VanEck Russia ETF (RSX) continues to trade; however, while ERUS holds Russian stocks, RSX mainly holds depositary receipts, which are not currently restricted from trading.

The Direxion Daily Russia Bull 2X Shares (RUSL) is set to close as announced by its issuer on Monday evening. Its last day of trading will be March 11.  

Both ERUS and RSX were much larger funds just a month ago. The former closed out January with more than $500 million in assets under management. It had less than $13 million in assets under management just days before its shutdown. Meanwhile, RSX had nearly $1.3 billion at the end of January and RUSL had roughly $56 million. The fall of all three funds has been brutally sharp due to Russia’s recent invasion of Ukraine.

Contact Heather Bell at [email protected]

Jessica Ferringer, CFA, is a writer and analyst for She has 10 years of experience in investment research and due diligence, including helping to manage ETF portfolios. Jessica has a bachelor’s degree in economics from Lafayette College and an MBA from the University of Pittsburgh.