Cryptocurrency traders have been using P2P exchanges to evade the international sanctions imposed on some Russian banks.
Binance’s latest regulatory hurdle may be intensified as it ceases support for P2P payments from five sanctioned Russian banks such as Rosbank and Tinkoff Bank, prohibiting all card payments.
This measure was informed by the exchange in a statement published today, which was quoted by several media especially in the midst of the legal problems the platform has been facing in several countries, indicating that the measure is due to the need to align Binance’s operations with international regulatory standards, so it will be subject to the applicable regulations in case of political and financial sanctions.
The company’s P2P service previously failed to follow international sanctions against particular banks, as reported earlier this week.
Due to international sanctions, many cryptocurrency exchanges restricted or ended their ruble-based services, causing Russian cryptocurrency traders to opt for P2P alternatives.
Binance Separates from Rosbank, Tinkoff, and other Russian Banks
Binance’s P2P marketplace allows interested parties to trade cryptocurrencies, which will remain in escrow while the buyer transfers the corresponding fiat amount to the seller outside the platform.
As such, the sanction prevents users from being able to set up any of these banks as a means of payment in their trade orders, something that those who usually operate through these institutions to move their money should be aware of.
The Wall Street Journal recently said that Binance is permitting P2P trades of rubles for cryptocurrencies that include Russian banks under sanctions. These banks are Tinkoff Bank, the second-biggest credit card provider in Russia, and Rosbank, a former subsidiary of Société Générale.
Until this week, customers at sanctioned banks were still using their cards to purchase cryptocurrencies.
The banks were referred to by colors instead of their actual names, apparently in an attempt to hide the payment method. For instance, Sber and Tinkoff bank cards were labeled as “green” and “yellow” payment options respectively on the P2P platform.
Binance is being investigated in the U.S. for helping to violate sanctions. These recent revelations could make things even harder for the exchange.
However, on August 25th, Binance blocked payments made with cards from five banks that are under sanctions. At the same time, the platform prohibited Russian users from conducting P2P transactions with currencies other than the ruble.
ByBit is Replying to Russian Sanctions by Cutting Ties with certain Russian Banks
BeInCrypto’s Russian team discovered this development recently. Similar to Binance, ByBit has also delisted cards held at these sanctioned institutions as P2P payment options.
ByBit has a Telegram chat support channel, which includes information on P2P support for Russian-sanctioned banks. The source of this information is the BeInCrypto ByBit Telegram support channel.
The report states that it is impossible to use certain bank-issued cards for P2P payments on ByBit now as it has implemented tighter restrictions on payments made with Tinkoff and Sberbank cards.
ByBit’s support team stated that certain banks can no longer be used to make payments on their platform.
Additionally, those who wish to use cards issued by Tinkoff and Sberbank must have completed an enhanced Know Your Customer (KYC) process. The same KYC requirements also apply to other payment services, such as YuMoney.
By Audy Castañeda
