Will Russian civilians lose out on Crypto?

Sahana Kiran
Source – Unsplash

Russian President Vladimir Putin’s solitary action enraged the entire world. While some have sent prayers to Ukraine, others have issued death threats against Russian citizens. The lives of numerous civilians were displaced in what is now known as World War 3. As Russia continues to exert its power over Ukrainians, governments from across the globe have come to the aid of the affected country.

The US administration has chosen to play its role by imposing sanctions on Russia’s central bank. The Biden administration restricted Americans from doing business with Russia’s central bank. Furthermore, the sanctions went into force right away.

The US apparently implemented these measures after learning that the Russian central bank was “attempting to move assets” and that “there will be a considerable volume of asset flight starting on Monday morning from institutions throughout the world.” The urgency of the sanctions was related to the opening of the markets.

Further elaborating on the reason behind the sanctions, the government official stated,

“Our strategy to put it simply is to make sure that the Russian economy goes backward. As long as President Putin decides to go forward with his invasion of Ukraine.”

How is Crypto a part of this?

As part of the aforementioned restrictions, the Biden administration is said to have pushed crypto exchanges to keep a watch out for Russian users and organizations that were utilizing cryptocurrency to avoid sanctions.

While cryptocurrencies aren’t a viable alternative to US currency, their use cannot be nullified. Russians are could be using crypto to circumvent sanctions. As a result, crypto exchanges in the United States were notified.

Will Russian civilians face the wrath of their President’s actions?

Just yesterday, Kraken, Coinbase, and other exchanges revealed that they wouldn’t impose a blanket ban on Russian addresses. The exchanges pointed out that this would demand legal requirements issued by the respective governments. With US’s latest sanctions, the chances of these exchanges restricting Russian users were high.

The first cryptocurrency, Bitcoin [BTC], was created to provide financial independence to ordinary people. The crypto market seemed like a whole new world, free of the constraints of centralized systems. The recent demands of the Ukrainian government, as well as US sanctions, may, however, undermine the crypto industry’s ethos.

Therefore, the crypto community urged crypto exchanges to rather focus on or freeze the accounts of the Russian government as opposed to the civilians.