Several news outlets including Zero Hedge and the Telegram reported that Russia was planning on buying $10 billion dollars worth of Bitcoin to hedge against US sanctions. The story which was first picked up by The Daily Hodl, referenced a string of tweets from economist Vladislav Ginko, who allegedly works at the state-funded Russian Presidential Academy of National Economy and Public Administration. In a tweet, Ginko said that Russia had no option but to invest in Bitcoin.
Chris, I believe sitting here in Moscow, Russia, that the real factor of Bitcoin apotion will be when Russian government I'm working for will start investing almost $470 billion reserves into Bitcoins. I expect that it'll be at least $10 billion in the first quarter of this year.— Vladislav Ginko (@martik) January 6, 2019
In December, the US increased sanctions against Russia, adding several companies and persons to the list of entities the US cannot trade with. Even though Russia is not a huge exporter to the US, some experts blame sanctions for the countries' stagnant economy.
Ginko continued to send out similar tweets, stating that there’s an enormous amount of work underway in Moscow to invest “huge” amounts of the central bank’s reserves in Bitcoin. He cited three key reasons to prove his case; 1. Many officials’ families invested in BTC. 2. US Sanctions may be mitigated only through Bitcoin use. 3. Pension reform needs crypto.
While his reasoning may be valid, Ginko’s identity probably isn't. For starters, Ginko has begun citing articles based on his own tweets as evidence of his claims. He also sent a bizarre tweet urging President Donald Trump to free Bernie Madoff, claiming he’s the true Satoshi Nakamoto (the creator of Bitcoin).
I promise to fight for the freedom of Bernard Madoff, the true Satoshi Nakamoto. @realDonaldTrump be courageous, ask for the retrial of Bernie, he's innocent, he was silenced and threatened since he was too much aware of murky financial deals of Obama & Biden.— Vladislav Ginko (@martik) January 12, 2019
The suspect chain of Tweets from his unverified Twitter account has raised eyebrows, causing multiple sources to question the validity of the viral headline.
It remains unclear who exactly Vladislav Ginko is and if he actually has any ties to the Kremlin. But one thing is for sure, the Russian government has made no official comment on the allegations that they're investing central bank reserves in Bitcoin.
How did we get here?
A Imagur user created a detailed chart of how this story came to be, from Ginko's Twitter to Daily Hodl's article. While comical, the illustration demonstrates the dangerous power of fake news.
On the other hand, the Russian government investing in Bitcoin to hedge US sanctions isn’t that far fetched of an idea. One of Russia’s trading partners, Iran, has publicly considered investing in crypto for the exact same reason. A report from TIME also found extensive Russian ties to Venezuela’s state-backed crypto the Petro. According to an executive at a Russian state bank who deals with cryptocurrencies, senior advisers to the Kremlin have overseen the effort in Venezuela, and President Vladimir Putin signed off on it last year. The unnamed executive told TIME, “People close to Putin, they told him this is how to avoid the sanctions.”For now, Ginko’s Tweets are most likely nothing but fake news. If Russia is buying $10 billion worth of Bitcoin, they haven’t made it public knowledge yet.