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Binance, the world’s biggest crypto exchange, on Monday,
said blocked the accounts of Russian individuals on whom sanctions have been
imposed but will not “unilaterally” freeze the accounts of all Russian users.
“We are not going to unilaterally freeze millions of
innocent users’ accounts,” a Binance spokesperson for told CNBC.
“Crypto is meant to provide greater financial freedom for
people across the globe. To unilaterally decide to ban people’s access to their
crypto would fly in the face of the reason why crypto exists.”
The comments come after Ukraine’s Vice Prime Minister, Mykhailo
Fedorov, on Sunday called on all the major cryptocurrency exchanges to block
all Russian user accounts.
“It’s crucial to freeze not only the addresses linked to
Russian and Belarusian politicians, but also to sabotage ordinary users,”
Fedorov said in a tweet.
Why banning crypto addresses is essential?
Western countries have also banned Russia from using the SWIFT
network, a global payment system that connects foreign banks and allows
cross-border financial transfers.
The United States and the European Union have imposed
sanctions on Russian banks, sovereign debt, Russian President Vladimir Putin’s
inner circle, and the leader himself, forcing the Russian Ruble to tumble.
On Monday, the Russian central bank increased its interest
rate from 9.5% to 20% as the Ruble hit a record low against the U.S. Dollar.
“As with the traditional financial system, Russia can
leverage cryptocurrency to evade the sanctions that are being put in place in
response to their invasion of Ukraine,” Caroline Malcolm, Head of International
Policy at blockchain analytics firm Chainalysis, told Decrypt last week.
ALSO READ: What
the US and EU are doing about Ukraine
Binance said it is “taking the steps necessary to ensure we
take action against those that have had sanctions levied against them while
minimizing impact to innocent users,” but also added that “should the
international community widen those sanctions further, we will apply those
aggressively as well.”
Jesse Powell, the chief executive of another major crypto
exchange, Kraken, on Monday tweeted that the company “cannot freeze the
accounts of our Russian clients without a legal requirement to do so.”
Picture Credit: CNBC