Amidst the crisis happening in the region of Ukraine, centralized crypto companies are directed to follow the sanctions that are being placed by the US and EU.
In accordance with multiple reports, many cryptocurrency-based firms and exchanges that are working on a centralized basis will have to follow the newly forged sanctions that have been placed against the banks of the Russian Federation, by both the United States and the European Union. Any of the cryptocurrency firms that are associated with the SEC or FCEN will have to comply with the sanctions placed.
Invasion of Ukraine
The severe sanctions being placed on the Russian Federation are the result of their brutal invasion against the country of Ukraine for their alleged alliance with NATO, so in order to put a strain on the Russian economy, limiting the access to the dollar, the US and many other countries from the European Union have decided to act accordingly.
Popular crypto exchange, Binance publicly stated to Bloomberg that they have arranged a special worldwide “compliance task force”, that comprises of many sanction specialists, will focus on working to “comply with the sanctions” being placed, in order to maintain stability on the platform and reduce any negative effects on its users.
A crypto company by the name of Gemini Trust Co. also stated their compliance with the sanctions and will not be offering their services in the hostile regions of both Russia and Ukraine. Adding to that Gemini stated that they will be revaluating “customer accounts” and will be taking relevant action towards groups associated with the sanctions.
Crypto as an Escape Method
However, the sanctions placed on the Russian Federation have instead promoted the use of cryptocurrencies in the region to mitigate the effects of the dollar. The report from Bloomberg suggests that the wealthy could have started to utilize cryptocurrencies in order to escape from any financial firms, not being affected by the sanctions and having no trace for anyone to follow.
According to a Russian representative from Binance, named Maria Agranovskaya, she said that nothing has been said that would affect crypto and despite the US and EU imposing sanctions on Russian banks, it seems that cryptocurrencies would have no effect from this. Maria continued that the crypto space might have effects later, but not today.