Here’s what Kraken CEO had to say about its Russian users

Sahana Kiran
Source – Unsplash

The escalating violence in Ukraine as a result of the Russian government has prompted the world to declare open vengeance on the country. Now, as Russia faces the economic consequences of its actions, Ukraine’s Vice Prime Minister Mykhailo Fedorov is encouraging big cryptocurrency exchanges to block Russian accounts. Jesse Powell, Kraken’s co-founder, and CEO explained why the crypto exchange couldn’t assist Ukraine in this field.

Fedorov in his tweet said,

“I’m asking all major crypto exchanges to block addresses of Russian users. It’s crucial to freeze not only the addresses linked to Russian and Belarusian politicians but also to sabotage ordinary users.”

Powell acknowledged that he understood the minister’s and Ukrainian people’s requests. But, he stated that Kraken could not quickly freeze the accounts of its Russian users. This was primarily due to legal complexities.

However, keeping in mind the current situation, Powell clarified,

Source – Twitter

Powell emphasized Kraken’s purpose by saying that the exchange intends to transfer people out of the old banking system and into the crypto-verse. They don’t have to worry about being caught up in wide, indiscriminate wealth expropriation in a digital world “where arbitrary lines on maps no longer matter.”

The CEO believes that most Kraken users were anti-war. He further cited the incident that occurred in Canada. Powell noted how crypto was the “only financial rail” in the country for all those who opposed the regime.

In addition to this, Powell alerted Russians that they should be aware that an ultimatum of this sort was imminent.

What measures can Kraken take to limit Russian clients?

In his closing statement, Powell said,

“Besides, if we were going to voluntarily freeze financial accounts of residents of countries unjustly attacking and provoking violence around the world, step 1 would be to freeze all US accounts. As a practical matter, that’s not really a viable business option for us.”

While Kraken continued to refuse to freeze the accounts of Russian clients, Flexpool, a mining pool, devised a workaround. Flexpool agreed that suspending Russian accounts would necessitate a legal requirement. It is possible, however, to prevent Russian users from registering new accounts.