Crypto Industry Rejects Politicians Pushing Exchanges to Block Russian Users

Last updated: Mar 30, 2023
3 Min Read
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As tensions in Ukraine lead to sanctions against Russia, some politicians have called for crypto exchanges to play a role in blocking the flow of funds to the former Soviet republic.

Speaking in an interview with MSNBC, former first lady and presidential candidate Hillary Clinton said she was “disappointed” in “so-called crypto exchanges” for not doing more to prevent Russia from evading sanctions.

“Some of them are refusing to end transactions with Russia, from some philosophy of libertarianism or whatever,” she said.

“Everybody, and if there has to be legal or regulatory pressure, everybody should do as much as possible to isolate Russian economic activity right now. That pressure will absolutely impact them.”

Clinton said that the Treasury Department, and officials in Europe should look at how they can prevent crypto markets from “giving an escape hatch” to both Russian government and private individuals looking to send transactions in and out of their country.

Image via Shutterstock
Image via Shutterstock 

“I would hope that they would do that because it’s so ironic because for people who live to make money, if they’re making it legally, if they’re not just a device or an excuse for money laundering, they should not want this invasion by Russia to stand,” Clinton said.

The former Secretary of State suggested that by putting pressure on Russia and contributing to the maintenance of national security, the crypto industry would create an environment that would be “good for business.”

However, so far, Clinton’s viewpoint is highly unpopular among crypto industry executives, particularly exchange CEOs. While exchanges are legally required to block specifically sanctioned Russian accounts, the biggest in the space aren’t keen on taking it a step further and block all Russian users.

“We are not going to unilaterally freeze millions of innocent users’ accounts,” Binance told Fortune in a statement. “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.”

Kraken CEO Jesse Powell said that despite his respect for Ukraine, the exchange “cannot freeze the accounts of our Russian clients without a legal requirement to do so.”

“Our mission at @krakenfx is to bridge individual humans out of the legacy financial system and bring them into the world of crypto, where arbitrary lines on maps no longer matter, where they don't have to worry about being caught in broad, indiscriminate wealth confiscation.”

Powell’s thread was in response to Mykhailo Fedorov, Ukraine’s vice prime minister who had the same stance as Clinton, asking for a unilateral ban of Russian users from all exchanges.

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