First Mover Americas: Bitcoin Nears $45K on Increased Demand From Ukraine and Russia

The latest moves in crypto markets in context for March 1, 2022.

AccessTimeIconMar 1, 2022 at 1:40 p.m. UTC
Updated May 11, 2023 at 5:58 p.m. UTC

Good morning, and welcome to First Mover, our daily newsletter putting the latest moves in crypto markets in context. Sign up here to get it in your inbox each weekday morning.

Here’s what’s happening this morning:

  • Market Moves: Bitcoin extends Monday's rally even as traditional markets signal caution.
  • Featured stories: Analysts cite increased demand from Ukraine and Russia as catalyst behind bitcoin's bullish move.

And check out the CoinDesk TV show "First Mover," hosted by Christine Lee, Emily Parker and Lawrence Lewitinn at 9 a.m. U.S. Eastern time. Today's show will feature guest:

  • Greg King, founder and CEO, Osprey Funds

Market Moves

By Omkar Godbole

Bitcoin (BTC) neared the $45,000 mark, extending Monday's gain despite risk aversion in traditional markets.

The futures tied to the S&P 500 slipped, the 10-year Treasury yield hit one-month lows and the yield on the 10-year German bund yield returned to negative territory after a month.

In currency markets, the safe-haven U.S. dollar and Japanese yen picked up a bid, while the growth-sensitive Aussie and Kiwi dollars erased early gains. Gold rose 0.5% and oil jumped 5% on both sides of the Atlantic.

The traditional market action signaled lingering anxiety and a sense of apprehension, given the Russia-Ukraine peace talks failed to achieve anything concrete yesterday and violence continued.

"We may see another round in the days ahead. In the meantime, don't expect the hostilities in Kyiv to ease as the push and pull on the ground and sanctions continue," ForexLive's Justin Low said in a market update.

Latest Headlines

Bitcoin Sees Increased Demand from Ukraine and Russia

By Omkar Godbole

Bitcoin ended February with a 12% gain, snapping the three-month losing streak, which saw the cryptocurrency tank from $69,000 to $39,000.

Almost the entire monthly gain stemmed from Monday's 14.5% surge, the most significant daily percentage rise since Feb. 8, 2021. Analysts cited a short squeeze and pick up in demand from Ukraine and Russia as catalysts fueling the move higher.

"In percentage terms, bitcoin recorded the largest daily candle in more than a year, gaining more than 18% day-over-day at the highest point of the rally," Mikkel Morch, executive director at crypto hedge fund ARK36, said in an email. "While it seems that the second leg of the move was at least partially fueled by a small short squeeze, overall, the rally was driven by a huge spike in demand."

Trader and analyst Alex Kruger tweeted, "Word on the street has been heavy bitcoin buying conducted by both Ukrainians and Russians. Mostly the latter. They have more money to protect."

"Bitcoin traded at a significant premium in ruble terms on Monday," Kuger told CoinDesk in a Telegram chat, adding that "it's a matter of internal demand and capital controls/restricted access."

On Monday, the Russian central bank raised borrowing costs from 9.5% to 20% and introduced some capital controls to arrest the ruble's slide, brought about by the West's punitive sanctions on Moscow. Per the Wall Street Journal, the Kremlin issued a decree, stating that foreign-exchange payments under loan agreements to non-resident Russians would be prohibited from March 1.

"Capital controls without demand don't make an impact on price. Capital controls mean price will deviate to one side or the other depending or where the demand is," Kruger said while explaining the source of Russian premium.

Data tracked by Kaiko, a Paris-based cryptocurrency research provider, shows bitcoin traded at a 6% premium on dominant digital assets exchange Binance's Ukrainian hryvnia (UAH) market compared to bitcoin's price in the U.S. dollar market following Russia's invasion of Ukraine. The premium perhaps stemmed from Ukrainians looking for alternatives amid disruptions in foreign exchange markets.

"Demand surged on Binance as local Ukrainian currency markets faced significant disruptions, with the Ukrainian central bank temporarily halting foreign currency withdrawals and the Ukrainian hryvnia falling to all time lows versus the U.S. dollar," Kaiko's research analysts Clara Medalie and Dessislava Aubert said in a weekly newsletter published Monday.

It remains to be seen if increased demand from Ukraine and Russia is the beginning of wider adoption of the cryptocurrency as a safe haven or a one-off event.

According to ARK36's Morch, "The biggest crypto asset is now looking at a potential decoupling from risk assets and it is doing so at a time of unprecedented uncertainty."

"Cash used to be king in times of crisis but now rising inflation levels and broader macroeconomic woes make holding large amounts of cash risk in and of itself," Morch added.

Bitcoin trades at premium on Binance's Ukrainian hryvnia (UAH) market. (Kaiko)
Bitcoin trades at premium on Binance's Ukrainian hryvnia (UAH) market. (Kaiko)


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CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

Omkar Godbole

Omkar Godbole is a Co-Managing Editor on CoinDesk's Markets team.

Parikshit Mishra

Parikshit Mishra is CoinDesk's Deputy Managing Editor responsible for breaking news coverage. He does not have any crypto holdings.