Changpeng said his firm obeyed government mandates but considers restricting all Russian users during this war is unethical. While Kraken thinks it is unfair to ban Russians without a fully legal basis, Coinbase refuses to block those not sanctioned.
Cryptocurrency exchange Binance ignored the requests by the United States to restrict access to their Russian clients. Its CEO, Changpeng Zhao, considers the sanctions imposed on all Russian citizens are unfair, as many do not support the conflict with Ukraine.
Other exchanges like Kraken and Coinbase also refused to prohibit Russian users from using their services. Their CEOs told Mykhailo Fedorov, the Vice Prime Minister of Ukraine, that they would only block only those citizens targeted by sanctions.
Zhao recently stated that his firm obeyed government mandates regarding imposing limits on sanctioned countries. However, he considers restricting all Russian citizens during the war against Ukraine is unethical.
The executive said that all cryptocurrency-related firms had to meet the same regulations as any other company. He noted that this forces the Binance exchange to comply with the sanctions requirements of the US regulatory framework.
However, the CEO of Binance explained that anyone on the sanctioned list could not use the platform, but anyone not on it could.
Other Exchanges Agree with the Position of the Binance CEO
While Joe Biden discussed sanctions and cryptocurrency exchanges, the Vice Prime Minister of Ukraine urged to block access to Russia.
However, most cryptocurrency exchanges agree with the Binance CEO Changpeng Zhao.
Jesse Powell, the CEO of Kraken, stated that he respects Ukrainian citizens but thinks it is unfair to ban Russians without a fully legal basis.
A spokesperson of Binance added that taking such an action goes against what cryptocurrencies represent.
Another leading exchange, Coinbase, refused to block access to users in Russia not on the sanctioned list.
All exchanges are subject to anti-money laundering regulations, an additional relevant level of security.
In addition, the narrative that Russia could use cryptocurrencies to evade sanctions could have an obvious flaw. The Eurasian country would lack liquidity due to its conflict with Ukraine.
It is hard to find exchanges that offer large amounts of cryptocurrencies, such as those that a world power like Russia would request.
A clear example is the maximum liquidity of the RUB/BTC pair, which does not exceed USD 200,000 on any leading exchange. That amount is too far from the USD 50 billion that passes through Russia every day.
Changpeng Considers Cryptocurrencies Will Not Help Russia Evade Sanctions
The CEO of Binance recently stated that the Kremlin could not use cryptocurrencies to evade sanctions.
The executive explained cryptocurrencies were too easy to trace, so the focus should be on banks and the oil market.
The US is considering imposing sanctions on the Russian cryptocurrency market since crypto assets could help make cross-border transactions. Zhao noted that did not apply to Binance, as they follow the same sanctions rules as banks, according to international standards.
According to Zhao, cryptocurrency transactions are not an effective tool for illicit activities. He explained that anyone could scrutinize a blockchain, given that it registers every operation.
Billionaire businessman Changpeng Zhao, whose wealth is around USD 1.9 billion, donated USD 10 million to help those fleeing the conflict between Russia and Ukraine.
By Alexander Salazar
