Russia wants to use cryptocurrencies to prevent Western sanctions from taking effect. US Senator Elizabeth Warren is concerned.
MOSCOW – Russia’s President Vladimir Putin could use cryptocurrencies to circumvent sanctions. The USA and the EU had imposed this because the Kremlin had launched a war of aggression against Ukraine. “Yes, Senator, it is possible,” said US Treasury Secretary Elizabeth Rosenberg. CNBC , among others, had reported on this.
Senator Elizabeth Warren Rosenberg had previously asked whether this could work with digital payment values. Warren is particularly concerned that oligarchs could use cryptocurrencies to circumvent sanctions. “In the past, countries like South Korea have already used this opportunity to circumvent sanctions. Now the Russian elite could do the same,” said the politician.
Ukraine War: US Tracks Down Individuals Using Crypto to Circumvent Sanctions
The US has already tracked down twenty-two people and two groups supporting Russia with cryptocurrencies during the Ukraine war. Entangled in it, among others: the oligarch Konstantin Malofeev. According to CNBC , the US has also sanctioned Market Hydra and Garantex, Russian crypto exchanges on the dark web.
Accordingly, all accesses are blocked, as are transactions. However, Russia is able to use tools to hide digital transactions that are actually sanctioned. Russia is currently developing its own digital currency, which is scheduled to be launched in 2024. Finance reports that the country is considering legalizing cryptocurrencies like Bitcoin and Ethereum to process transactions with pro-Russian states or groups.
Because of sanctions: Russian Ministry of Finance wants to enable crypto transactions
According to the Russian Ministry of Finance, crypto transactions should be possible for domestic companies in order to import products and ensure the companies’ survival. In addition to the USA, a country from Europe also wants to consistently enforce sanctions.
At the beginning of September, Great Britain declared that it would take tough action against Russians and companies trying to circumvent sanctions. According to Finance , the definition of “funds” and “economic resources” is broad. “Crypto assets are considered to be covered by these definitions and therefore fall within the limits of financial sanctions,” according to the UK Treasury. However, so far there is no international law that forces crypto exchanges to freeze wallets. (mse)