Following the invasion of Ukraine, the US Department of Treasury has raised an alarm about the possibilities of Russia using virtual currencies to evade sanctions. Head of FinCEN, Him Das, said that engaging in proactive reporting is part of its strategy to support Ukraine in the ongoing conflict.
Many have predicted that Russia could use virtual currencies to evade sanctions, given that Russia’s President is a crypto enthusiast and the decentralized nature of the asset. Experts have explained ways the country can use bitcoin and others to circumvent the economic sanctions to prevent the country from plunging into recession.
FinCEN Urges All Crypto Firms to Report Any Activity
Speaking about the alleged Russia plan, Das urged all crypto firms and CVC-related companies operating in the U.S. jurisdiction to disclose any activity that could serve as a ploy for Russia to circumvent the sanctions. Although the agency revealed that Russia couldn’t circumvent extensive economic blockades through CVC, financial bodies are mandated to report any suspicious situation linked to the Kremlin country.
Russia isn’t the only country under the agency’s watch. Belarus is also reportedly being monitored. FinCEN has instructed financial entities to come forward with any information regarding Belarusian entities supporting Russia directly or indirectly conducting businesses.
Despite the mounting economic pressure Russia is facing, Das emphasized the need for financial bodies in the United States to be proactive and focus on methods Russia can employ to evade sanctions. Das added that it’s unlikely for Russia to elude all the sanctions through virtual currencies. Still, institutions must be watchful of any dubious activity, as it could be huge assistance in its support for Ukraine.
Federal Lawmakers Weigh the Possibilities of Eluding Sanctions Through Virtual Assets
U.S. lawmakers have shared their views on Russian banks and financial institutions using virtual currencies to elude the blockades imposed by the West in February. On the 28th of February, the Office of Foreign Assets has instructed Americans to avoid using digital currencies to help the Russian government.
In their opinion, cryptos are being used as a deceptive way of transacting business. According to TradingView.com, the total market capitalization is a little above $1.8 million at press time.
Lawmakers and members of the E.U. parliament have publicly updated everyone on Russia’s ploy to use cryptocurrencies to avoid the financial embargo. Given the public knowledge, Russia now has limited options for trading with countries, especially with its top banks being on the sanction list and the country being removed from SWIFT.
The crypto world experts President Biden to sign an executive order on virtual currencies later the week.