Treasury Department Warns Against Circumventing Russia Sanctions, Targets Digital Currencies and Physical Assets

The U.S. Treasury Department is calling out digital assets as it prepares to enforce new sanctions against Russia.

The Office of Foreign Assets Control (OFAC) is detailing a series of measures designed to target transactions that are connected to the Russian Federation.

A new rule says the Treasury may stop flows of capital that are “deceptive or structured transactions or dealings to circumvent any United States sanctions, including through the use of digital currencies or assets or the use of physical assets.”

The new measures come in the wake of a Bloomberg report that says the Biden administration is pressuring top US crypto exchanges such as Binance, FTX, and Coinbase to help identify sanctioned Russian users.

In addition, leaders in Ukraine are calling on crypto exchanges to freeze crypto assets tied to Russian users.

The CEO of the crypto exchange Kraken, Jesse Powell, says the exchange will not do so voluntarily but warns governments could force Kraken to take action.

“I understand the rationale for this request but, despite my deep respect for the Ukrainian people, Kraken cannot freeze the accounts of our Russian clients without a legal requirement to do so.

Russians should be aware that such a requirement could be imminent.

That requirement could come from your own government, as we have seen in Canada, in response to protests, bank runs and attempts to flee the country. It could come from foreign states, like the US, as a weapon to turn the Russian populace against its government’s policies…

Our mission at Kraken is to bridge individual humans out of the legacy financial system and bring them in to 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.

Sometimes the hardest thing about having power is knowing when not to use it. Our mission is better served by focusing on individual needs above those of any government or political faction. The People’s Money is an exit strategy for humans, a weapon for peace, not for war.”

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