It’s been three-and-a-half years since Russia invaded Ukraine — and at a much-vaunted summit in Alaska, Donald Trump and Vladimir Putin failed to reach an agreement that would bring the war to a close.
Back in February 2022, the crypto community had rallied around Ukraine. Elliptic figures showed digital assets worth over $212 million were raised to support the government and military — 44 times more than donations to pro-Russian entities.
Those with long memories will remember that, at one point, Ukraine was even considering an official airdrop to thank those who had made a contribution. This was later canceled, outraging those making donations in the hope of profits.
The meeting between the U.S. and Russian presidents in Anchorage was controversial to say the least. Many Ukrainians were disgusted by how Putin received the red carpet treatment, not to mention a flypast on the tarmac.
And while Trump had been calling for Moscow to agree to an immediate ceasefire, he now appears to have performed a rather drastic U-turn. Instead, he now wants a “peace agreement” to end what he calls “a horrific war” killing thousands of soldiers.
In this article, we’re going to unpack what happened at the summit, what might happen next, and how it could affect Bitcoin.
Trump and Putin meeting without Ukrainian President Volodymyr Zelenskyy had already caused disquiet among European nations. They have repeatedly argued that a ceasefire needs to be implemented before negotiations can commence.
As the U.S. president flew back from Alaska, he briefed leaders from the EU, Nato, France, Germany and the U.K. on developments — and also took the opportunity to invite Zelenskyy to the White House for a meeting on Monday.
Ukrainian officials will be hoping those discussions go better than the last trip to Washington, which saw a heated row between Trump and Zelenskyy break out in the Oval Office — right in front of the world’s cameras.
Before the summit, Trump had imposed a deadline of August 8 on Putin, warning the Kremlin that Russia would suffer a fresh round of punishing economic sanctions unless the war was over. And in another twist designed to pile on the pressure, the U.S. added that Russia’s closest trading partners would also be sanctioned too.
But now, as with many of the other “deadlines” that Trump has set, it seems these sanctions won’t be implemented — at least for now. Reporters were unable to ask questions at a news conference after the summit concluded, and in a rather woolly answer on Fox News, Trump only said he would consider revisiting sanctions at some point in the next two or three weeks.
How Will This Affect Bitcoin?
Bitcoin had surged to fresh all-time highs of $124,457.12 on Thursday, but failed to further advance into price discovery territory. Less than 12 hours later, the world’s biggest cryptocurrency cooled back down to $118,000, where it’s been trading ever since. The announcement that no deal was reached at the summit didn’t really seem to have much of an impact on the market overall.
If an agreement had been made, it’s likely that stocks would have endured something of a relief rally — with BTC benefiting indirectly. Continued uncertainty could prove especially beneficial for gold, which is often regarded as a safe haven.
The biggest drivers of BTC’s value in recent days actually relate to economic data coming out of the U.S. On Friday, we learned that the Producer Price Index jumped by 0.9% in July — spooking analysts and investors who had predicted an increase of just 0.2%. This led to a year-on-year rise of 3.3%, levels not seen since February.
Breaking this down, it shows that the wider Trump tariffs that have come into force are having an impact, with businesses passing on these costs on to customers. This in turn will affect consumer inflation further down the track, and could undermine the case for interest rate cuts at the Federal Reserve.
Make no mistake though, Russia has been working behind the scenes to build its resilience to sanctions. A recent report by the Center for Information Resilience pointed to how Moscow has developed a stablecoin called A7A5 — pegged to the ruble — enabling businesses and consumers to trade with foreign partners outside of the dollar system, not to mention Western crypto firms.
It isn’t just Ukraine that has been using crypto to its advantage.
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