• A group of Senate Democrats recently submitted a letter to the US Treasury Department seeking information on the steps taken to enforce the sanctions imposed on Russia. 

• The United States Treasury Secretary Janet Yellen in response assured that the US will continuously monitor the activities around the use of cryptos to prevent Russia from evading the sanctions.

The recent decision of Russia to go all out with its military operation in Ukraine has forced the European Union, and countries like Taiwan, the UK, the US, Japan, New Zealand, and Canada to impose sanctions on the country focusing on oil refineries, banks, and military exports. However, concerns have been raised on the possibility of the country bypassing these sanctions by taking advantage of cryptocurrencies. Many crypto exchanges have already embarked on a campaign to restrict the activities and to prevent the registration of new Russian users.

Additionally, Ukraine has decided to appeal to the public to help expose the crypto wallets of Russian and Belarusian politicians and report to these exchanges. The most recent development comes from the US Treasury Department noting the possibility of the Russians taking advantage of crypto to make these sanctions less effective. 

According to reports, a group of Senate Democrats recently submitted a letter to the US Treasury Department seeking information on the necessary steps taken to ensure that Russia does not take advantage of the digital assets to evade the sanctions. The letter also requests detailed information on how the Department seeks to monitor and ensure that the restrictions are properly enforced.

Bitcoin, not the only avenue for evading sanctions – US Treasury Department

The US Treasury Department has recently published rules and also urged crypto exchanges to block sanctioned individuals from accessing their platforms regardless of their locations. Despite some exchanges blocking Russians, Coinbase and Binance have issued a statement that they have no plans on imposing a blanket ban on Russian customers. However, they will block the trading activity of sanctioned individuals or entities.

Binance founder and CEO Changpeng Zhao stated:

We’re not against any people. We differentiate between the Russian politicians who start wars and the normal people. Many normal Russians do not agree with war. We don’t control the industry. I can publish my sanction list, you can publish yours… Guess what? No-one else is going to follow. It just moves Russian users to other smaller platforms.

US Senator Elizabeth Warren, Senate Banking Committee Chairman Sherrod Brown, and other lawmakers are concerned that some crypto firms may not enforce the new rules. It is important to note that the crypto market has recorded some positive growth since the sanction was imposed, and this was highlighted in the letter submitted to the US Treasury Department.

Related: Coinbase, Kraken, and Binance refuse to freeze Russian crypto accounts

The United States Treasury Secretary Janet Yellen in response assured that the US will continuously monitor the activities around the use of cryptos to prevent Russia from evading the sanctions. Also, she noted that Bitcoin is the most mentioned asset in the center of evasion, however, it does not seem to be the only avenue through which sanctions can be bypassed.