US, Allies Ban Russian Banks From SWIFT, Crypto Maybe Next Target

The US has joined Canada, the EU and UK in barring some Russians from the international money transfer system, SWIFT. The move is the most serious round of sanctions yet from Western nations over Russia’s actions in Ukraine, with Ross Delston, a U.S. lawyer and former banking regulator, calling it “the closest thing to a declaration of war from a financial perspective.”

“It’s going to result in Russia being viewed as radioactive by U.S. and EU banks, which in turn would be a major barrier to trade with Russia,” he continued. Cutting Russian banks off from SWIFT will make financial transactions more costly and difficult.

The weekend decision is expected to cause market volatility Monday, as financial analysts were beginning to anticipate a less intensive sanctions campaign from the West. “A lot of traders were kind of becoming convinced that the U.S. and Europe were not taking a hard stance,” said Edward Moya, senior market analyst at OANDA, a foreign exchange broker. “This action will be really difficult to digest and it will really pick a nerve for a lot of investors.”

While investors aired concerns over the move, it was welcomed by the Ukrainian government, with Prime Minister Denys Shmyhal tweeting that it would paralyze “the assets of Russia’s central bank.”