Modulus CEO: Crypto Could Feel Ripples from EU Boycott of Russian Energy

This week, Deutsche Bank CEO Christian Sewing made news after noting the consequences Germany would face if it shut off the Russian gas tap. Recently, the Baltic states announced their boycott of Russian energy imports, and the chorus for other EU countries to join them has been growing. Sewing warned of further increasing inflation if such a situation were to come to realization. One fintech CEO shared his thoughts on how the emerging situation would affect the digital assets space.

“There are two things to be aware of surrounding calls for the EU to stop importing Russian energy. First, such a situation would be dire to the Russian government; they are dependent on those import dollars. Without them, they will need to find a new revenue source in order to fund both the war and their domestic program. What that means for crypto? Russian hackers could be more aggressive and target exchanges. Perhaps more than ever before, the effective use of cold storage is critical,” said Richard Gardner, CEO of Modulus, a US-based developer of ultra-high-performance trading and surveillance technology that powers global equities, derivatives, and digital asset exchanges.

In his statement, Sewing invoked images of “a further deterioration of the situation if there’s a stop to imports or deliveries of Russian oil and natural gas,” foreshadowing dramatically heightened prices in the energy sector and other areas of the economy. “A clear recession in Germany would presumably be inevitable.”

“Beyond the cybercrime element of the equation, the inflation that would follow — surging beyond its already historic state after massive Covid-19 relief packages passed around the globe over the past two years — could mean that cryptocurrencies again are targeted by investors as value store assets,” said Gardner.

“Supply chains have faltered due to Covid, and we’re still in the midst of rebounding. Those issues, in conjunction with increased deficit spending, will only compound the pain that consumers face in the EU, if Russian gas taps are shut off — in particular, in Germany, which is the EU power most closely tied to Russia. It wouldn’t be remarkable, to see increased interest in cryptocurrencies and other digital assets,” Gardner said.

Modulus is known throughout the financial technology segment as a leader in the development of ultra-high frequency trading systems and blockchain technologies. Modulus has provided its exchange solution to some of the industry’s most profitable digital asset exchanges, including a well-known multi-billion-dollar cryptocurrency exchange. Over the past twenty years, the company has built technology for the world’s most notable institutions, with a client list which includes NASA, NASDAQ, Goldman Sachs, Merrill Lynch, JP Morgan Chase, Bank of America, Barclays, Siemens, Shell, Yahoo!, Microsoft, Cornell University, and the University of Chicago.

“The biggest takeaway for cryptocurrency exchange operators? Make sure that your defenses are working flawlessly. There’s already increased risk of cybercrime, and a boycott of Russian gas would only worsen the situation. Securing client assets should be the number one priority,” said Gardner.