US Treasury Will Crack Down On Crypto Transactions For Russian Entities

The US Treasury will crack down on crypto transactions for all Russian entities and will also issue new rules to restrict financial transactions as sanctions against Russia so let’s read more in today’s latest cryptocurrency news.

The US treasury will crackdown on the crypto transactions made with prohibited Russian entities. The rules dubbed the Russian harmful Foreign activities Sanctions Regulations are in draft mode and will come into force tomorrow. The rules take aim at deceptive or structured transactions or dealings to avoid US sanctions including those that use digital currencies or assets as well as physical assets. The new regulations reiterated an existing executive order dubbed “Blocking Property With Respect to Specified Harmful Foreign Activities Of the Government of the Russian Federation” and the executive order was designed to stifle illicit Russian activity.

Back in April 2021, President Biden defined the harmful foreign activities that were undertaken by the Russian governemnt to include efforts and undermine elections but also engage in cyber-enabled activiit3es and foster transnational corruption to influence the foreign governments. Russia faced some sweeping sanctions since its invasion of Ukraine. These include Germany freezing approval of the Nord Stream 2 gas project and a wave of sanctions against Russia’s banks and state-owned enterprises like exclusion from the SWIFT payments system.

This is not the first time that the US Treasury Department warned against the use of digital assets to avoid sanctions. In a report, the Treasury added that the digital assets offer malign actors withs some more opportunities to hold and to transfer the funds outside of the financial system:

“They also empower our adversaries seeking to build new financial and payment systems intended to diminish the dollar’s role.”

Ukraine’s Vice President Mykahilo Fedorov called for the major crypto exchanges to block the Russian users:

“It’s crucial to freeze not only the addresses linked to Russian and Belarusian politicians but also to sabotage ordinary users.”

The top crypto exchanges like Kraken, Coinbase, and Binance refused to honor the request and argued that there’s no legal grounds to do so but the exchanges maintained that they will continue to comply with the mandated sanctions. Ukraine’s ministry also said it plans to make legal demands against the exchanges to require them to block the transactions for the Russian residents.