IMF still trying to pin Russian sanctions evasion on crypto

The IMF has doggedly continued to accuse the crypto sector as a place where Russia can dodge the sanctions imposed on it by the Western alliance. From anonymising tools to crypto mining, the IMF appears desperate to use crypto as a scapegoat for Russian sanctions evasion.

Even though it is with grudging acceptance, the IMF has recently said that it acknowledges that the Russian ruble and cryptocurrency trading pairs have declined over past weeks, making it very impractical for the country to make any transactions on a large scale.

However, it now says that there may be loopholes that could be exploited if anonymising tools are used. Although it doesn’t explain how this could be done either, considering the comparatively small amount of liquidity available for this type of process.

The latest fear for the IMF is that nations under sanction might start mining cryptocurrencies. This could take the form of countries using their energy resources in order to power the mining, and generate revenue from doing so.

According to a Bloomberg article on the subject, regulators are facing challenges to police the potential threat of cryptocurrencies being used by Russia in order to circumvent the economic sanctions imposed upon it.

As per the IMF report, the ways that this can happen is by firms having “inadequate compliance procedures”, or when technologies that “increase anonymity” are used. The IMF said:

“Regulators in the United States and United Kingdom, among others, have urged firms in their jurisdictions, including the crypto asset sector, to increase vigilance with regard to potential Russian sanction evasion attempts,”

In general the IMF is calling for global regulators to get together in order to develop a coordinated approach to the regulation of cryptocurrencies. However, according to the Bloomberg article, many countries have already developed an approach to the sector, and this varies widely, from an all out ban in China, to the UK stating that it wants to be a hub for crypto.

The IMF has proven itself to be a sworn enemy of crypto, and given the disruption that crypto might well cause to the existing financial system, this is certainly a reason for being so.

Nevertheless, it could be argued that crypto is generally showing that it has a vastly more transparent and efficient technology than what exists in the banking sector. As this becomes more apparent to all, the likes of the IMF might well be playing less of a prominent role in the future.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.