The United States Government appears convinced that Russia could use cryptocurrencies to escape sanctions hereby warning crypto companies against helping Russia.
According to Deputy US Treasury Secretary Wally Adeyemo, anyone who tries to help Russia avoid economic sanctions would be held accountable by the US government.
This comes after the United States and its allies slapped sanctions on Russia for its decision to invade Ukraine.
The Treasury Department has issued a warning to anyone who may be assisting Russia in evading sanctions.
Since the fighting began on February 24, millions of people have been displaced and many have died, resulting in a catastrophic humanitarian crisis throughout Eastern Europe. Russia’s economy is teetering as a result of the harsh sanctions imposed on it, as the country becomes increasingly isolated.
Adeyemo claimed on CNBC’s Street Signs Europe that there is no proof that Russia has been able to avoid the sanctions. However, he noted that the United State Government is aware that they are attempting to do so and that they will use all methods at their disposal to circumvent the sanctions.
Russia might evade sanctions by using opaque shell firms and cryptocurrencies, according to Adeyemo.
He said, “What we want to make very clear to crypto exchanges, to financial institutions, to individuals, to anyone who may be in a position to help Russia take advantage and evade our sanctions: We will hold you accountable.”
He added, in what appears to be a veiled threat against anyone wanting to assist Russia, that the US will ensure that they are not successful.
“Russia does not have the ability to get around the sanctions that we have put in place in order to make it harder for them to prosecute the illegitimate war that they have in Ukraine.”
Given the focus on digital assets by foreign powers in recent weeks, his mention of crypto is unsurprising.
The G-7 major economies, which include the United States, the United Kingdom, Canada, Japan, France, Germany, and Italy, have agreed to make it impossible for Russia and its allies to circumvent sanctions by using digital assets.
Can Russia Use Crypto Evade Sanctions?
Stakeholders in the bitcoin business have highlighted that a government like Russia cannot use cryptocurrencies to circumvent economic sanctions.
The Vladimir Putin-led administration, according to a recent analysis, is unable to use crypto to escape sanctions.
But it isn’t enough for authorities who believe that crypto’s anonymity makes it the ideal tool for evading sanctions.
While Russia has been unable to use cryptocurrencies due to concerted attempts, Ukraine has been using cryptocurrency to fund its defense. The country has received approximately $65 million in cryptocurrency donations since the crisis began.