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I have previously written about Ukraine and its Bitcoin/Crypto capital status in Europe and compared it to El Salvador. However, with the sharp increase in actual conflict between Ukraine and Russia, I have decided to pivot this out into its own story and updates. If you are wondering about why Ukraine is a huge crypto capital then I would recommend reading my about comparing and contrasting El Salvador and Ukraine. This part will explain the following: Ukraine's crypto adoption, Russia's encroachment on Ukraine and Russia reasoning, current news, and fallout.
Ukrainian State Back Crypto Adoption
Since 2000 Ukraine has had several governments rise and fall and because of the political turbulence investment in the country has been hard for the company to get. However, since the huge rise in crypto Ukraine has taken an approach that greatly differs then what other European countries have done. Rather than initiate study after study or crackdown against the government has met crypto with open arms. This has been done in a variety of ways but the biggest headline catchers have been entering partnerships with companies that will build data centers (which could just mine crypto) near some of the nuclear plants in the country that provide excess power and receive part of the profits. They have also taken considerable steps in clearing up the grey area that crypto has remained in many countries. Unlike El Salvador, they have not made it legal tender but have promoted and signed up companies to really bring these tech high paying jobs to the country.
This sales pitch has been really beneficial for the country as even Apple has looked into building data centers in the country. The country and its leaders are pouring all their resources into promoting the digital age in their country and resetting its image in the world. So far they have been pretty successful in bringing in foreign investment and people with the low cost of living and the regulated but minimal paperwork required to operate here.
Russia's Encroachment on Ukraine and Why
While in the 1990s the USSR fell Russia has worked hard over the years to maintain its sphere of influence over the countries that left the USSR. For the most part, they have not been as successful as they would have liked especially in Europe as NATO rapidly grew its size and influence. In the Middle East and Asia though they have really maintained said influence against others. When Ukraine was brought into the USSR Stalin was quick to shut down any sort of independence and mismanaged a situation that resulted in famine and approximately 3 million-plus Ukrainians starve to death.
These missing people were filled with ethnic Russian individuals who currently reside in the Eastern part of the country and the Crimea Peninsula in Ukraine. When Ukraine expressed a desire to join the EU and NATO Russia did what it could to prevent this. This led to another revolution in 2013-2014 which forced the President to flee to Russia and European ties to pick of pace and strength. Russia's response was seizing Crimea and fostering discontent in the Eastern part of Ukraine. Politicians and the world really looked the other way as Russia engaged in a proxy war with Ukraine but once MH 17 was shot down over Ukraine by a Russian-made missile and from a separatist region. Not a lot was accomplished with the agreements that were hashed out as people on both sides and violations continued to happen but the number of deaths was decreased.
Current News and Fallout
Starting last year Russia began massing troops along the border of Ukraine and while the numbers were large they really were not enough to cause any sort of invasion. The numbers though kept growing over the following months and the Kremlin used military exercises as the excuse for what was going on. It became apparent though that that was not the case. The number of troops and the way that they were spread out signaled possible military action. This freaked out Ukraine, the EU, and the US leading to calls to stand down and act through diplomacy. Rather than that though Putin instead started to mass troops in the country north of Ukraine, Belarus, and also start military exercises there. To add some icing on the cake Russia finally began to begin drills in Crimea and the Black Sea moving military equipment and assets from across the country to these areas to do so and massing over 150,000 troops in the process.
Right now I am sure you are thinking but how does this impact crypto? Well, Russia is the number three miner in the world and with the threat of sanctions looming have moved from the position of banning crypto and crypto mining to beginning to embrace it. The reason why this is an issue is that it could be easily used to defeat sanctions that Russia faces. Also, it has completely ground to a halt all of the advancements that Ukraine was achieving with crypto as home defense has taken center stage.
Last night news broke that Russian State-owned media was saying that Ukraine had attacked one of the separatist regions however nothing really happened that the actual proof behind it is shaky at best. I have never heard of a country attacking separatists with a single machine gun but that was cited in the reports. This morning a whole new issue broke and that was the shelling of a school that had teachers and kids present in it by separatists. This attack has been validated with data. One of the issues that both sides face is that whoever starts it will be known since about a billion satellites and other civilian and military equipment are looking at the country right now 24/7/365.
Final Thoughts
Again this is just a quick and dirty catch up to those of you who were not up to date with the issues facing crypto and the unique place and situation that is going on. In the day and weeks moving forward I will be sure to post updates about what is going on and the impacts it is having on the market.
Please know I am not a financial advisor I am just someone who picked up on a trend and wanted to express it! Makes sure you always do your own research and never invest money you cannot afford to lose! If you enjoyed this article and would like to further support me below are a couple of referral links that if you used when signing up I would appreciate it! Also, follow me on Twitter @Cje95_
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