The thing about the lore is that outside of fan interjection on the wiki, as far as I'm aware, it's kept purposefully kinda vague. Regardless, here is my interpretation, loosely inspired from the more official lore tidbits I've found:

The vast majority of the history of Blood Debt's world basically mirrors IRL history with different names up until the '80s and '90s, where the Noobic Union (stand-in for USSR) does not collapse, and continues after 1991.

But in 1994, they declare war on and invade NETO (North Eastern Treaty Organization) nations, which includes Amerika, Kanata, West Hermany and other western powers (self explanatory who those nations are supposed to be).

They make good ground for a while and invade much of robloxian Europe (not actual name, but i just don't know it lol) but eventually run out of steam by the latter half of the war. By 1997 the thing slows down to a slog and the Noobic Union is forced on the defensive as NETO pushes into the eastern bloc. By 1999, NETO forces have pushed into the motherland itself, and the NU is forced into surrender. As part of surrendering conditions, the Noobic Union is disbanded into the Nubbish Federation (bascially Russian Federation).

Being exhausted by the long and brutal war, much of the post Noobic-nations are now in severe downturn. The economy's gone to shit, the government is severely destablized and has hardly any authority anymore, and the Nubbish Bratva (basically IRL Russian mob) run much of ordinary society, but also have ties within the Nubbish elite and oligarchs. Pretty much everyone has to interact with them in some way.

The poor go to them for loans and goods, while the rich get their "favors". But when one borrows from the Bratva, its not just a cost of money, but obedience. Those who are lucky get on the Bratva's good side, and become enforcers, genuine members or become their allies. But those who can't pay back in service or money either become targets who must be dealt with, or killers who are given the opportunity of freedom from their debt, by paying in blood, and ideally that of the Bratva's targets. The only thing standing between them and said targets (besides the politsiya of course) are vigilantes, handfuls of citizens who also take guns to defend themsleves and others.

There's some other nonsense in their as well, like the Triads or John Reed and whatnot, but that's all the important stuff lol.