[Bitcoin Now] Decline Amid US Sanctions on Russian Cryptocurrency

[Image source=Yonhap News]

[Asia Economy Reporter Lee Jung-yoon] Bitcoin prices are declining following the U.S. announcement of sanctions against Russian cryptocurrency exchanges and the dark web.

According to the global cryptocurrency market tracking site CoinMarketCap, as of 10:54 a.m. on the 6th, Bitcoin was priced at $45,237 (approximately 55.21 million KRW), down 2.76% from the previous day. On the domestic cryptocurrency exchange Upbit, Bitcoin is trading at 55.66 million KRW, down 0.89% (501,000 KRW) compared to the previous day.

Bitcoin prices fell on the 5th (local time) after the U.S. Treasury Department's Office of Foreign Assets Control (OFAC) announced sanctions against the Russian cryptocurrency exchange Garantex and the dark web marketplace Hydra. According to cryptocurrency media such as CoinDesk, U.S. Treasury Secretary Janet Yellen stated, "The United States is concerned about the global threat of cybercrime and ransomware originating from Russia and the fact that criminal leaders continue to operate without punishment." She also mentioned cooperation with allied countries Germany and Estonia.

The U.S. Treasury has prohibited U.S. citizens from providing or receiving funds or goods and services through Garantex or Hydra and plans to freeze any assets under its jurisdiction. Additionally, in cooperation with the U.S. Department of Justice, the Federal Bureau of Investigation (FBI), and German police, the Hydra servers were shut down, and approximately $25 million (about 30.5 billion KRW) worth of Bitcoin was seized. Over 100 cryptocurrency wallets related to Hydra operations are also being tracked. It is known that about 80% of cryptocurrency transactions on the dark web last year occurred on Hydra.

Furthermore, aggressive interest rate hike remarks by Lael Brainard, the nominee for Vice Chair of the Federal Reserve (Fed), appear to have had an impact. Brainard, attending a conference hosted by the Minneapolis Federal Reserve Bank, said, "Lowering inflation is the most important task," adding, "The Fed will begin rapid balance sheet reduction immediately after the May Federal Open Market Committee (FOMC) meeting and will systematically tighten monetary policy through consecutive interest rate hikes."

Meanwhile, Dunamu's Digital Asset Fear & Greed Index recorded 55.65, indicating a 'neutral' stage. This is a decrease of 1.52 compared to the previous day's 57.17 (neutral). Dunamu's Digital Asset Fear & Greed Index is divided into stages of 'Extreme Fear (0?20)', 'Fear (20?40)', 'Neutral (40?60)', 'Greed (60?80)', and 'Extreme Greed (80?100)'. A greed direction indicates increased buying interest among market participants, whereas a fear direction leads to market exits due to fear of asset decline, causing a chain reaction of price drops.