White House issues its executive order on cryptocurrencies

Lucas Matney
Wed, March 9, 2022

The Biden White House showed off a new executive order on Wednesday regarding the regulation of cryptocurrencies. The order essentially lays out a broad strategy for how the government plans to balance consumer protection while ensuring that the United States continues to be a space for innovation in the sector.

For those in the crypto sector concerned about aggressive government intervention, the order's language seems to signal that the Biden White House is uninterested in sweeping near-term reforms and is instead merely focused on ensuring that agencies are on the same page in researching and observing the national security implications of the crypto industry.

"The rise in digital assets creates an opportunity to reinforce American leadership in the global financial system and at the technological frontier, but also has substantial implications for consumer protection, financial stability, national security, and climate risk," a fact sheet issued by the White House reads.

The press release lays out seven major goals of the executive order with added detail:

Protect U.S. Consumers, Investors, and Businesses

Protect U.S. and Global Financial Stability and Mitigate Systemic Risk

Mitigate the Illicit Finance and National Security Risks Posed by the Illicit Use of Digital Assets

Promote U.S. Leadership in Technology and Economic Competitiveness to Reinforce U.S. Leadership in the Global Financial System

Promote Equitable Access to Safe and Affordable Financial Services

Support Technological Advances and Ensure Responsible Development and Use of Digital Assets

Explore a U.S. Central Bank Digital Currency (CBDC)

While crypto investors may generally breathe a sigh of relief, fellow lawmakers like Elizabeth Warren who have been highly critical of the crypto space may be less satisfied. In recent months, Warren has criticized the industry, drawing particular attention to the environmental impacts of cryptocurrencies and the investor risks associated with lax regulation of so-called stablecoin issuers and other players in the DeFi ecosystem.

The White House's communications regarding the EO largely seems to avoid calling out any particular coins or projectsm with the exception of noting the price volatility of Bitcoin specifically. There was no mention of particular verticals like DeFi or NFTs, either.

A particular concern among some in the crypto industry was that the potential use of cryptocurrencies by wealthy Russian elite to evade sanctions would prompt a crackdown, but one unnamed senior official on a background press call seemed to downplay this possibility. "I will say, on Russia, in particular, the use of cryptocurrency we do not think is a viable workaround to the set of financial sanctions we’ve imposed across the entire Russian economy and, in particular, to its central bank."

A major focus of the order is formally directing several government agencies to begin researching the development of a state-backed cryptocurrency -- a U.S. Central Bank Digital Currency (CBDC). "This research, along with the framework we will develop for international engagement and competitiveness, will help ensure we preserve the critical role of the United States in the global financial system," a senior White House official said.

President Biden will sign the executive order today, the White House says.

Biden signs order on cryptocurrency 

as its use explodes

FATIMA HUSSEIN

Wed, March 9, 2022,

WASHINGTON (AP) — President Joe Biden on Wednesday signed an executive order on government oversight of cryptocurrency that urges the Federal Reserve to explore whether the central bank should jump in and create its own digital currency.

Treasury Secretary Janet Yellen said the effort would “promote a fairer, more inclusive, and more efficient financial system" while countering illicit finance and preventing risks to financial stability and national security.

The Biden administration views the explosive popularity of cryptocurrency as an opportunity to examine the risks and benefits of digital assets, said a senior administration official who previewed the order Tuesday on the condition of anonymity, terms set by the White House.

Under the executive order, Biden also directed the Treasury Department and other federal agencies to study the impact of cryptocurrency on financial stability and national security.

Brian Deese and Jake Sullivan, Biden's top economic and national security advisers, respectively, said the order establishes the first comprehensive federal digital assets strategy for the United States.

"That will help position the U.S. to keep playing a leading role in the innovation and governance of the digital assets ecosystem at home and abroad, in a way that protects consumers, is consistent with our democratic values and advances U.S. global competitiveness," Deese and Sullivan said Wednesday in a joint statement.

The action comes as lawmakers and administration officials are increasingly voicing concern that Russia may be using cryptocurrency to avoid the impact of sanctions imposed on its banks, oligarchs and oil industry due to the invasion of Ukraine.

Last week, Democratic Sens. Elizabeth Warren, Mark Warner, and Jack Reed asked the Treasury Department to provide information on how it intends to inhibit cryptocurrency use for sanctions evasion.

The Biden administration has argued that Russia won’t be able to make up for the loss of U.S. and European business by turning to cryptocurrency. Officials said the Democratic president's order had been in the works for months before Russia's Vladimir Putin invaded Ukraine last month.

Daleep Singh, a deputy national security and economic adviser to Biden, told CNN on Wednesday that “crypto’s really not a workaround for our sanctions.”

The executive order had been widely anticipated by the finance industry, crypto traders, speculators and lawmakers who have compared the cryptocurrency market to the Wild West.

Despite the risks, the government said, surveys show that roughly 16% of adult Americans — or 40 million people — have invested in cryptocurrencies. And 43% of men age 18-29 have put their money into cryptocurrency.

Coinbase Global Inc., the largest cryptocurrency exchange in the United States, said the company had not seen a recent surge in sanctions evasion activity.

Treasury Secretary Janet Yellen said last week that “many participants in the cryptocurrency networks are subjected to anti-money laundering sanctions” and that the industry is not "completely one where things can be evaded.”

As for the Federal Reserve getting involved with digital assets, the central bank issued a paper in January that said a digital currency “would best serve the needs” of the country through a model in which banks or payment firms create accounts or digital wallets.

Some participants in digital currency welcome the idea of more government involvement with crypto.

Adam Zarazinski, CEO of Inca Digital, a crypto data company that does work for several federal agencies, said the order presents the opportunity to provide “new approaches to finance.”

“The U.S. has an interest in growing financial innovation," Zarazinksi said. He added that China and Russia were looking at crypto and building their own currency. More than 100 countries have begun or are piloting their own digital sovereign currency, according to the White House.

Katherine Dowling, general counsel for Bitwise Asset Management, a cryptocurrency asset management firm, said an executive order that provides more legal clarity on government oversight would be “a long term positive for crypto.”

But Hilary Allen, a financial regulation professor at American University, cautioned against moving too fast to embrace cryptocurrencies.

“I think crypto is a place where we should be putting the brakes on this innovation until it’s better understood,” she said. “As crypto becomes more integrated into our financial system it creates vulnerabilities not just to those who are investing in crypto but for everybody who participates in our economy.”

On Tuesday, the Treasury Department said its financial literacy arm would work to develop consumer-friendly materials to help people "make informed choices about digital assets.”

“History has shown that, without adequate safeguards, forms of private money have the potential to pose risks to consumers and the financial system,” said Nellie Liang, undersecretary for domestic finance.

Bitcoin and cryptocurrency related stocks got a boost Wednesday following Biden’s executive order.

The price of Bitcoin was up 9.8% at $42,211, according to Coindesk. Shares in cryptocurrency exchange Coinbase Global surged 9.3% in midday trading, while online brokerage Robinhood Markets rose 4.5%.

Riot Blockchain, which focuses on cryptocurrency mining, jumped 11.5%. Digital payments platforms also rose. PayPal added 4.9% and Block climbed 10.55%.

___

Associated Press writers Thalia Beaty in New York, Christopher Rugaber in Washington and Alex Veiga in Los Angeles contributed to this report.

Bitcoin: What Biden’s new law could mean for crypto investors

Brian McGleenon
Wed, March 9, 2022

Will a new digital dollar soon exist to give bitcoin a run for its money? 

Photo: Reuters/Dado Ruvic

The Biden administration unveiled its long-awaited executive order on cryptocurrency regulation today, but what does it mean for investors?

The new order instructs agencies to officially recognise and regulate digital assets in the US.

It also tasks the US government to review the technological infrastructure needed to roll out a central bank digital currency, or 'digital dollar'.

The US is currently lagging behind China in this respect after Beijing showcased the use of its 'digital yuan' at this year's Winter Olympics.

The "Executive Order on Ensuring Responsible Innovation in Digital Assets" was signed by President Joe Biden today.

But, what does this "whole government strategy on digital assets" mean for investors in the cryptocurrency space?

Read more: 'Crypto lobby groups are dictating terms in Washington'

There has been a rapid expansion of cryptocurrencies across the globe, with the latest update being Wednesday's bitcoin (BTC-USD) legalisation in war-torn Ukraine.

In light of this, the US government's executive order is a strong signal that the crypto-sector is not going to go away any time soon.

The executive order stresses the need to facilitate the responsible development of the cryptocurrency industry, whilst "combating illicit exploitation, and reducing negative climate impacts".

An immediate reaction by many investors to the news that the Biden administration was about to issue a crypto executive order would have been panic and fear of a regulatory shutdown.

However, the details of the order convey an enthusiasm on the part of the US government to learn about the industry and make America a leader in its development.

In a statement released yesterday by US Secretary of the Treasury Janet Yellen said that “under the executive order the Treasury will partner with interagency colleagues to produce a report on the future of money and payment systems".

Watch: Economist Steve Hanke on crypdigto-lobbyists



Analysts have studied the order and the statement by Yellen and suggested it has lessened fears among crypto investors that the Biden administration would take a hard stance on the evolving crypto sector.

This has helped boost the price of key cryptocurrencies today, with bitcoin (BTC) hiking to above $42,000.

Read more: Club for women in crypto promises to close gender funding gap

According to Rebecca Retting, general counselor for Aave, president Biden’s executive ordrer represents a landmark moment for the web3 ecosystem. Speaking to Yahoo Finance she said: "The recognition by the United States government that web3 constitutes the next generation of the internet. This order signals a long-term commitment by the White House to support the industry and bring the US into a leadership position in this space."

"The Web3 industry is committed to collaborating with and working responsibly with policymakers, agencies and regulators as they respond to the order’s research directives, to ensure that the US makes sound Web3 policy that is able to evolve with the ecosystem."

It is historic that the order comes at the same time Web3 infrastructure is being leveraged to support Ukraine in its current crisis in myriad ways – a sign of the expansive promise of this technology and the ways it can enhance all aspects of our world."

According to many leading proponents of cryptocurrency, such as MicroStrategy's Michael Saylor, the US regulatory interest is welcomed.

Read more: Crypto live prices

Saylor maintains that widespread adoption of cryptocurrencies such as bitcoin will only take place when the industry has "clear crypto regulations".

Speaking to CNBC Saylor said: "Additional regulatory clarity from the Biden administration is going to benefit bitcoin and accelerate institutional adoption of that asset."

The executive order raises lots of questions, such as will stablecoins be shut down with the development of a Federal Reserve issued 'digital dollar'?

There are no specifics as yet as the order is the first step in a comprehensive study by the US government in cryptocurrencies, NFTs and decentralised finance.

The White House fact sheet claims that "surveys suggest that around 16% of adult Americans have invested in, traded, or used cryptocurrencies", now the Biden administration wants to overhaul how the nascent industry is regulated.

With the new executive order, the Biden administration wishes to protect US consumers, investors, and businesses from "any systemic financial risks posed by digital assets".

It also proposes a Financial Stability Oversight Council to bring some clarity and order to the rapidly developing cryptocurrency sector.

The White House document states a need to "identify and mitigate economy-wide financial risks posed by digital assets and to develop appropriate policy recommendations to address any regulatory gaps".

The new order recognises the need for the US to "drive innovation and maintain competitiveness" in the sector.

The US Treasury Department has been tasked with producing a "future of money and payment systems" with significant urgent development of a US central bank digital currency, CBDC.

Swedish PM rejects opposition calls to consider joining NATO

Tue, March 8, 2022

STOCKHOLM (Reuters) - Swedish Prime Minister Magdalena Andersson on Tuesday rejected opposition calls to consider joining NATO following Russia's invasion of Ukraine, saying an application now would destabilize security in Europe.

Sweden has not been in a war since 1814 and has built its foreign policy on non-participation in military alliances, but it has forged ever closer ties to NATO in recent years as tensions with Russia in the Baltic region have risen.

Russia's invasion, which it calls a "special military operation", has renewed calls for Sweden to join NATO, alongside Finland, which has also remained outside the bloc.

"If Sweden were to choose to send in an application to join NATO in the current situation, it would further destabilize this area of Europe and increase tensions," Andersson told reporters.

"I have been clear during this whole time in saying that what is best for Sweden's security and for the security of this region of Europe is that the government has a long-term, consistent and predictable policy and that is my continued belief."

Russia does not want Finland or Sweden to join NATO and late last month, Moscow made its latest warning of "serious military-political consequences" if they did.

Andersson was speaking after meeting opposition party leaders to discuss the worsening security situation.

A poll on Friday by Demoskop and commissioned by Aftonbladet newspaper showed 51% of Swedes were in favour of NATO membership, up from 42% in January. People against joining fell to 27% from 37%. It's the first time such a poll has shown a majority in favour.

Ulf Kristersson, the leader of the Moderates, called on the government to begin broad domestic political discussions about NATO membership, a debate that has already started in Finland.

Finland and Sweden have close military ties and a move by one to join NATO would put added pressure on the other to apply.

"It is urgent," Kristersson told news agency TT.

"We can't get behind a wind-break and hope that it all blows over and then be surprised by a Finnish decision in a month or two."

(Reporting by Simon Johnson, editing by Anna Ringstrom and Nick Macfie)

How This Superyacht Became an 

Overnight Geopolitical Mystery

Jessica Cherner

Wed, March 9, 2022

The Russia sanctions are growing, seemingly by the hundreds, every day. And much of the world is watching with glee as oligarchs’ luxuries are being hunted down by international governments. If we’ve learned anything from movies like The Wolf of Wall Street, which is based on a true story, it’s that some of the world’s wealthiest enjoy flaunting their money. Not only do billionaires often spend their money on toys like European sports cars and diamond-encrusted watches, but they also want the world to know to whom these extremely rare possessions belong.

After all, Jeff Bezos has been accumulating quite a bit of press as he works on dismantling a historic bridge in Rotterdam to sail his $500 million yacht onto the open sea. But some billionaires play their cards a bit closer to the chest. Case in point: the owner of a 459-foot superyacht docked in a Tuscan port. No one, not even the Italian police, can identify who the enormous vessel belongs to, which leads the world to believe it may be someone tied to one of the world’s most currently despised leaders: Vladimir Putin.

Mega Yacht ''Scheherazade'' anchors in Turkey's Mugla

Scheherazade, which costs an estimated $700 million, boasts not one but two helicopter decks.

Photo: Anadolu Agency/Getty Images

Few believe that the floating mansion actually belongs to the Russian president—whose recent invasion of Ukraine is earning more sanctions than he, his country, and his billionaire friends thought imaginable—but many are more certain that it belongs to someone with ties to the top of the Russian government.

Since the devastating fate of Ukraine started to unfold, the United States, along with the UK and the European Union, have come together to track down the luxuries belonging to Putin’s friends, who are part of a massively growing list of billionaires facing punishing sanctions. That’s why this boat, one of the world’s largest and costliest, is such a point of interest.

International governments have been going after the luxurious belongings of Russian oligarchs since Putin and his government started getting slapped with sanctions two weeks ago, so assuming the yacht hiding out in Italy is one of Putin’s friend’s, things aren’t looking so good. However, no one can confirm just yet. The ship’s British captain, Guy Bennett-Pearce, promised that Putin had never been on the boat and that it didn’t belong to him, but he didn’t confirm whether or not the yacht belonged to a Russian national.

RUSSIA-TURKEY-DIPLOMACY

Russian president Vladimir Putin.

Photo: VLADIMIR SMIRNOV/Getty Images

Considering all of the amenities on the boat, dubbed Scheherazade, it’s not exactly an unfair guess to assume the owner is a Russian oligarch. Scheherazade, which costs an estimated $700 million, boasts not one but two helicopter decks, an indoor swimming pool with a retractable cover that transforms the pool into a dance floor, a fully equipped gym, and bathrooms complete with gold-plated fixtures. That’s a lot of sparkle even for the level of wealth associated with a purchase this big. However, the glamour isn’t the unusual part; the degree of intentional secrecy is.

The superyacht community does entertain a level of confidentiality—mostly for security purposes—but the Scheherazade is kept under so many wraps that it makes people believe something dubious must be going on when it comes to the owner’s identity. For instance, all of the contractors and crew members signed nondisclosure agreements, there’s a custom cover to hide the boat’s nameplate, and when Scheherazade arrived at the port, workers built a metal structure on the pier to keep passersby from seeing the yacht.

Roman Abramovich's yacht "Eclipse" anchors in Turkey

The 459-foot superyacht is currently docked in a Tuscan port.

Photo: Anadolu Agency/Getty Images

This yacht, however, isn’t the only one catching people’s attention as of late. The world’s second-biggest yacht, called Eclipse, is owned by Roman Abramovich, the Russian billionaire who bought (and has since sold his ownership stake) in the British soccer club, Chelsea. Interestingly, the UK government has yet to sanction any of Abramovich's assets in the country.

As for Scheherazade, that mystery is still being investigated, and until the feds can figure out who the not-so-proud owner is, the behemoth on water will remain where it is, shrouded in a cloak of well-orchestrated secrecy.

Originally Appeared on Architectural Digest

 

European authorities are trying to track down the owner of a superyacht nicknamed 'Putin's yacht' by locals

Rebecca Cohen
Tue, March 8, 2022,

'Scheherazade', one of the largest superyachts in the world, anchors in 

Bodrum district of Mugla, Turkey on August 16, 2020.

Osman Uras/Anadolu Agency via Getty Images


European authorities are trying to track down the owner of a superyacht docked in Italy.


The owner of the Scheherazade is unknown because of confidentiality and non-disclosure agreements.


Some think the yacht could belong to Putin himself and locals have nicknamed it "Putin's yacht."

European authorities are trying to track down the owner of a superyacht currently docked in Italy, whose ownership has been a mystery, according to the New York Times.

As assets of Russian oligarchs and those close to Russian President Vladimir Putin are seized, authorities are trying to identify the owner of the Scheherazade — a 459-foot-long superyacht sitting in a marina on the Tuscan coast of Italy.

Some think it could belong to one of the oligarchs, and locals told The Times that the boat has even been nicknamed "Putin's yacht."

"Everybody calls it Putin's yacht, but nobody knows whose it is," Ernesto Rossi, a retired clerk seen walking near the marina told The Times. "It's a rumor that's been going around for months."

The ship's captain, Guy Bennett-Pearce, told The Times Putin has never been on the yacht, and that the owner was not on any sanctions list, though he didn't rule out the possibility of the owner being Russian.

Bennett-Pearce told The Times that he had to sign non-disclosure agreement before working aboard the Scheherazade.

NDAs are commonplace among luxury vessels, according to Nautilus International, a union for maritime professionals, and many crew members and contractors aboard Scheherazade likely had to sign them alongside Bennett-Pearce, which is why its ownership remains a secret.

The Times reports that the Scheherazade has also taken extra steps to ensure privacy, including a cover to protect its nameplate and a barrier at the port to obstruct some of the boat from view.

Bennett-Pearce told The Times that he was forced to hand over the owner's information to "men in dark suits" Monday, but that he was promised the identity of the owner would remain confidential.

"They are looking hard," Bennett-Pearce told The Times. "They are looking at every aspect."

But Bennett-Pearce told The Times that the ship does not belong to a Russian oligarch or to Putin.

"I have no doubt in my mind whatsoever that this will clear the vessel of all negative rumors and speculations," he told the Times.

The investigation into the Scheherazade comes as officials are cracking down on a number of wealthy and powerful Russians in an attempt to seize their assets after a round of international sanctions was announced.

Sanctions were announced by countries across the world after Russia invaded Ukraine in late February.

 

The crew of a Russian oligarch's $600

 million superyacht was fired after 

sanctions meant wages couldn't be paid, reports say

Grace Dean

Wed, March 9, 2022

The US Treasury says the yacht's estimated worth is between $600 million and $735 million.Mikhail Svetlov/Getty Images, Sabri Kesen/Anadolu Agency via Getty Images

• The crew of the Russian oligarch Alisher Usmanov's superyacht was fired on Monday, reports said.

• The company that staffed the boat said sanctions meant crew wages couldn't be paid, Forbes reported.

• Usmanov's estimated worth is $18.4 billion, and his yacht is valued at $600 million to $735 million.

The crew of the Russian oligarch Alisher Usmanov's 512-foot superyacht was fired after Western sanctions prevented wages from being paid to the vessel's staff, multiple outlets reported.

Sarnia Yachts, a yacht-management company in the UK that provided the crew for the $600 million vessel, Dilbar, said in an email to staff on Monday that "normal operation of the yacht has ceased," and that its crew had to be dismissed "as a result of the sanctions imposed," Forbes reported.

The West has imposed heavy sanctions on Russia, with the aim of crippling its economy and cutting off its military's funding, in an attempt to pressure President Vladimir Putin to end the invasion of Ukraine. The West has imposed sanctions not only on Russian banks but also on Russian elites and oligarchs, and they include the seizure of assets such as private jets and superyachts.

The European Union, UK, US, and Switzerland have all sanctioned Usmanov, freezing his assets and, in some cases, barring him from entering their territory. The EU said Usmanov "actively supported" the Russian government's policies of the destabilization of Ukraine.

Usmanov is worth an estimated $18.4 billion, the UK government said. He is the founder of USM Holdings, which has interests in metals, mining, and telecoms. His largest holding is in the Russian steel giant Metalloinvest. The European Union said he had "particularly close ties" to the Kremlin, calling him one of "Putin's favorite oligarchs."

The US has declared Dilbar "blocked property," which prohibits US staff from working on the vessel and bans the payment for its docking fees in US dollars.

Sarnia said in Monday's email to staff that the sanctions meant that some of the companies supporting Dilbar's crew were "unable to continue their normal lines of business," Forbes reported. Sarnia added that it was unable to continue paying salaries to the ship's crew, and that their final wages would instead be paid by the boat's owner, Forbes said.

"We have tried all avenues to find a solution to keep the team in place, and protect our positions, but have reached the end of the road of possibilities," Tim Armstrong, the yacht's captain, wrote in a message to the crew, Bloomberg reported.

The US Treasury said Dilbar's estimated value was between $600 million and $735 million, and that it cost an estimated $60 million per year to run.

Its builder, Lürssen, says it's the "largest motor yacht in the world by gross tonnage." The vessel is equipped with two helicopter pads and has its own 82-foot swimming pool.

Forbes reported that the ship usually had 96 crew members on board, while Bloomberg put the figure at 80.

Sarnia said in the email to the crew that a small number of staff from Lürssen, which owns the Hamburg shipyard where Dilbar has been docked for a refitting since October, would instead look after the "safety and security" of the ship, Forbes reported.

Forbes also reported that Dilbar had been seized by German authorities on March 2, but it issued a correction the following day that said the ship hadn't been impounded. Hamburg's Ministry for Economy and Innovation told Bloomberg that Dilbar wouldn't be able to leave the port until it received an export waiver from Germany's federal customs agency.

Lürssen declined to comment. Sarnia Yachts and Hamburg's Ministry for Economy and Innovation did not immediately respond to Insider's request for comment.

A $600 million superyacht linked to the Russian billionaire Roman Abramovich 

has left a Spanish shipyard after 

undergoing repairs since 2021

Kate Duffy

Wed, March 9, 2022, 

Russian President Vladimir Putin, right, speaks as Roman Abramovich looks on during a meeting with top businessmen.

Mikhail Svetlov/Getty Images

• A superyacht linked to Roman Abramovich has left a Spanish shipyard, according to MarineTraffic.

• The $600 million yacht had been docked there for repairs since late 2021, one person told Reuters.

• Abramovich hasn't yet come under sanctions imposed by the US or European Union.

A superyacht with ties to the Russian oligarch Roman Abramovich departed from Barcelona in Spain on Tuesday after undergoing repairs since last year.

The yacht's departure was first reported by Reuters.

The vessel, named Solaris, left the shipyard of the Spanish yacht-maintenance firm MB92 in Barcelona on Tuesday afternoon, according to the ship-tracking site MarineTraffic.

Solaris, which spans 140 meters, or 460 feet, has a price tag of $600 million and can hold up to 36 guests, according to SuperYachtFan, which said that Abramovich owns the yacht.

The yacht was finished in 2021 after being built by the German company Lloyd Werft, according to SuperYacht Times.

A person in the industry told Reuters that the yacht had been docked at the Barcelona shipyard since late 2021, but it wasn't clear where it was headed next.

"We never comment on the movements of the yacht or any other vehicles or vessels," a spokesperson for Abramovich told Reuters.

MB92 declined to comment to Reuters and Insider.

The news comes as the wealthiest Russians sought to move their yachts and private jets to different locations after the invasion of Ukraine in an attempt to protect their assets.

Abramovich, who has a net worth of $13.6 billion, according to a Bloomberg estimate, hasn't yet come under US or EU sanctions, which have been imposed on other Russian oligarchs and billionaires with ties to President Vladimir Putin since his troops invaded Ukraine.

Last week, Abramovich announced he was selling the English Premier League team Chelsea FC, with an asking price of $2.5 billion, The New York Times reported.

After years of living in Moscow, I have bad news: No one should expect the Russian people to suddenly rise up against Putin now

March 8, 2022


In late 2011, tens of thousands of Russians took to the streets of Moscow to demand that election results rife with alleged fraud be overturned.

It was the biggest challenge to Vladimir Putin’s authority since he took power a decade earlier, and that it wasn’t immediately crushed gave hope that perhaps change was coming to Russia.

“There has been a phase shift — like water starting to boil — anything is possible from here,” one protestor told me at the time. It was a level of optimism that has not been seen since.

As Russia wages war in Ukraine and deals with crippling economic sanctions that have crushed the ruble, sent prices soaring, and shredded its citizens’ savings, street protests have begun anew, but it is hard to imagine public outcry strong enough to shake the Putin regime.

Over the past decade, the Kremlin has systematically hounded whatever vestiges of the protest movement into silence. Many of its organizers now live abroad. Its most well-known figure, Alexei Navalny, has been jailed.

For the rest of the country, years of increasingly monolithic messaging through state media has further undermined whatever resistance might take root.

“The Russian population has been lulled into a deep political sleep under Putin after being bombarded for years by such lies and misinformation on TV.”

The Russian population has been lulled into a deep political sleep under Putin after being bombarded for years by such lies and misinformation on TV, following decades of a similar approach under Soviet rule. Why bother being engaged if you don’t know what to believe?

Many are convinced that Russia is simply trying to dislodge Nazis who have taken power in Kyiv and that Ukrainian people are welcoming Russian soldiers with open arms. Nowhere to be seen on state-controlled television are images of Ukrainian housing blocks blasted to dust and fleeing civilians killed by indiscriminate Russian shelling.

What little independent media remained has been entirely shut down under new rules from the Kremlin vowing to harshly punish any news outlet that deviated from the official line. Even foreign media has been forced to curtail operations so as not to run afoul of the new rules,

Average Russians have also seen their standard of living improve under Putin following the turbulent 1990s when Russia was recovering from the collapse of the Soviet Union. Wages have risen. Average people can afford foreign cars and annual holidays to the beaches in Greece and Egypt. For years, many had little interest in rocking the boat.

And the brutal stifling of all dissent has driven home to many that there is little upside to being politically engaged, unless you were fully for Putin. As a matter of survival, it was better to just keep your mouth shut.

“The oligarchs don’t pick their leader, Putin picks who his oligarchs are. They have limited influence, so a palace coup from the business class seems unlikely. ”

It is difficult to imagine Russia’s sudden global pariah status and the collapse of the economy quickly changing this dynamic.

The other theory is that sanctions will cause such deep economic pain to the country’s oligarchs, who are seeing their yachts and overseas villas being seized, that they will rise up and push Putin into changing course.

But that betrays a fundamental misunderstanding of Russia’s power dynamics — the oligarchs don’t pick their leader, Putin picks who his oligarchs are. They have limited influence, so a palace coup from the business class seems unlikely.

Putin’s power lies with the country’s all powerful intelligence agencies, defense complex and police force, none of which he is likely to lose anytime soon.

Perhaps sanctions and the threat of global war will rouse long dormant forces in Russia, but it seems unlikely that that will happen swiftly.

Lukas I. Alpert is a financial crimes reporter for MarketWatch, and a former Moscow correspondent for The Wall Street Journal.

Ukrainian woman struggles to get Russian parents to believe that civilians are under attack

Stephen Proctor
Tue, March 8, 2022,

Lisa, a Ukrainian woman who escaped Kyiv and is currently in western Ukraine and who also asked that her last name not be used for safety purposes, appeared Monday on Don Lemon Tonight, where she spoke about the effectiveness of the disinformation campaign that the Russian government is currently running on its citizens. Lisa said that her parents live in Russia, and believe the propaganda they are fed on a daily basis. Even her own evidence wasn’t enough to convince them that the Russian military is doing anything wrong.

“They can’t believe that Russians are doing anything wrong. They can’t believe that Russians are hitting civilian buildings,” Lisa said, later adding, “Even when I show the photo of my own neighborhood, which is rocket-launched, they still … they — I can’t understand how it happens.”

The Russian government has recently cracked down on independent journalism and free speech even more than normal in an attempt to spin its own narrative about the war that it started, and Lisa said her parents believe what the government is telling them.

“They really believe what they see on TV more,” Lisa said. “Of course they are afraid for my own safety and for their grandchildren, but I’ve heard from them that even things like Ukrainian army is shooting its own civilians. But who serves in the Ukrainian army? Those who have their homes and their families here.”

Lisa said that even before the war, her parents and other Russians laughed at Ukrainians who took the threat of invasion seriously.

“She told me that Russians are laughing at that panic,” Lisa said. “They believe that Ukrainians are just crazy, that Russia will never attack. So it was just one week before the invasion.”