Kremlin: Russia is preparing to be disconnected from SWIFT
1–10 of 15 posts
Re: Kremlin: Russia is preparing to be disconnected from SWIFT
#2Anyone knows the significance of this?
Re: Kremlin: Russia is preparing to be disconnected from SWIFT
#3Anyone knows the significance of this?
SWIFT disconnection is discussed alongside with oil embargo and freezing a ~$1T on the US/EU accounts of Russian elite. Taken for the face value it's pretty significant; however given the history of West generally letting Russian government doing whatever, the stakes could appear to be lower.
Re: Kremlin: Russia is preparing to be disconnected from SWIFT
#4BEWARE the site will serve additional stories that appear to be malicious. For example do not click on the Clint Eastwood story appearing at the bottom.
Re: Kremlin: Russia is preparing to be disconnected from SWIFT
#5Anyone knows the significance of this?
SWIFT is essentially a system for structured authenticated bank-to-bank messages in which pretty much every worldwide financial institution participates - in some ways a glorified email (though with structured fields), but with sufficient security assurances that if you get a message claiming to be from the First Bank of Nigeria (FBNINGLA) "pls do XYZ with USD 100 million kthxbye" then you would actually consider it to be sufficient authorization to execute that request. You still might wait until actually getting that money from them though before passing it on, counterparty risk is a thing, but you can assume that it's actually from them and whoever is sending has the authority to act on their behalf for huge amounts of money.
If Russian institutions can't participate, it means a disconnection for the majority of international financial communications, preventing Russian banks from directly interfacing with all the thousands of banks worldwide - they will have to establish a bilateral communications protocol with some specific partners/correspondent banks (perhaps they have something arranged already) and have someone else handle the international transactions on their behalf. That's not totally devastating, but a pain in the butt, extra expenses, extra delays and extra risk for all those transactions.
Re: Kremlin: Russia is preparing to be disconnected from SWIFT
#6Anyone knows the significance of this?
Its significant because the US has a virtual monopoly over global banking with the SWIFT system, which is used to impose sanctions and punish our perceived geopolitical foes. The use of the SWIFT system as a cudgel has led other countries to develop their own, competing SWIFT-like systems that would not be controlled by the US. Russia, China and India have been signaling their future adoption of this system for several years.
https://finance.yahoo.com/news/china-russia-india-push-forwa...
Re: Kremlin: Russia is preparing to be disconnected from SWIFT
#7Anyone knows the significance of this?
Its significant because the US has a virtual monopoly over global banking with the SWIFT system, which is used to impose sanctions and punish our perceived geopolitical foes. The use of the SWIFT system as a cudgel has led other countries to develop their own, competing SWIFT-like systems that would not be controlled by the US. Russia, China and India have been signaling their future adoption of this system for sever…
SWIFT is a Belgian company, not American. They are subject to European law, not the US. However, the US has pressured SWIFT to eject Iranian banks from their system or risk being sanctioned from doing business with the US banking system. SWIFT is not some magic sword that the US can wave around to do their bidding and that the US would be crippled without. Rather, the US banking system is significant enough that they can pressure not just SWIFT but any entity with significant financial ties to the US to enforce sanctions on America's behalf.
Re: Kremlin: Russia is preparing to be disconnected from SWIFT
#8They could use ripple, or stellar
Re: Kremlin: Russia is preparing to be disconnected from SWIFT
#9Anyone knows the significance of this?
Russia has also been working on a plan to run their internet disconnected from the global Internet if necessary. It sounds like they are anticipating various actions that would cause international sanctions and preparing ways to survive them.
Re: Kremlin: Russia is preparing to be disconnected from SWIFT
#10Anyone knows the significance of this?
It means little and less. Russia has been disconnected before and it didn’t last for very long. The Russians regularly make the statement that they are prepared to be disconnected (and they’ve spent a lot of time making it a true one). This particular disconnection threat is for if they invade the Ukraine, which seems less likely than it did a few weeks ago.