The U.S. Treasury Department lists digital currencies as part of sanctions against the Russian government

The U.S. Treasury Department and White House have reportedly warned U.S. companies and individuals not to facilitate crypto transactions sent to certain Russian citizens and banks.

Under regulations set to go into effect March 1 by the U.S. Department of the Treasury’s Office of Foreign Assets Control, U.S. residents are prohibited from using digital currencies for the benefit of the Russian government — including the country’s central bank — as a way to circumvent U.S. allegations of its invasion of Ukraine. Sanctions. The guidelines equate crypto transactions with “deceptive or structured transactions” that attempt to evade sanctions.

U.S. Treasury Secretary Janet Yellen said the department's actions were designed to "substantially limit Russia's ability to use assets to fund its destabilizing activities and to target funds that Putin and his inner circle relied on to invade Ukraine." Officials It said the additional actions against Russian entities were authorized under Executive Order 14024, which allows the Treasury Department to impose sanctions based on "harmful foreign activities, including violations of generally recognized principles of international law."

Today, the United States and our allies and partners are preventing Putin from getting his war funds to cushion the blow of our sanctions and to fund his invasion of Ukraine.
— The White House (@WhiteHouse) February 28, 2022
On February 24, U.S. President Joe Biden announced that the U.S. and its allies would impose sanctions on five major Russian banks and several elite nationals who “get rich at the expense of the Russian state.” As the invasion of Ukraine continues and officials appear to be looking for more ways to financially deter the Russian government, the European Commission said on Sunday it plans to move the country's sanctioned banks from the SWIFT cross-border payments network remove.

While cryptocurrencies are listed as a possible means for Russia to evade sanctions, at least one Treasury official has reportedly suggested that digital currencies are unlikely to undermine international efforts. According to a Politico report on Friday, Todd Conklin, an adviser to the U.S. Treasury Undersecretary, said that if the Kremlin laundered large amounts of cryptocurrencies through exchanges, the market would see a “bigger surge” than it is currently. However, after Conklin’s statement, the price of Bitcoin did increase by 11% in the past 24 hours, reaching $41,624.

The White House has also asked crypto exchanges to prevent Russian individuals and businesses sanctioned by the U.S. and its allies from using digital assets to circumvent those restrictions, according to a report from Bloomberg on Monday. Cryptocurrencies are not a substitute for the U.S. dollar in Russia, but authorities will try to crack down on any misuse of digital assets to evade sanctions, officials have reportedly said.

Ukraine’s Digital Transformation Minister Mykhailo Fedorov has urged crypto exchanges to freeze addresses of Russian users, Cointelegraph reported Monday. However, Binance said it would not “unilaterally freeze the accounts of millions of innocent users,” while Kraken added that the exchange would not act “without a legal requirement.”