Russia can evade sanction through cryptocurrencies

[_act_]

The Russia's central bank wanted cryptocurrencies to be banned in its country but the Russian president, Vladimir Putin said bitcoin mining and other crypto mining will be beneficial for Russia. Some people at that time have been supectimg this could be a move by the Russia's president that he is planning to invade Ukraine which will result to sanctions, thinking cryptocurrencies would be a means to evade sanctions and make it economically less effective.

Ukrainian Vice Prime Minister Mykhailo Fedorov demand crypto exchanges to freeze all Russian accounts so that the sanction can be effective, but most exchanges did not support this. I read few days ago that cryptocurrencies may not help in Russia sanction but FinCEN concluded that Russia can attempt to use cryptocurrencies to evade sanctions.

FinCEN Provides Financial Institutions with Red Flags on Potential Russian Sanctions Evasion Attempts

What is your take? What role can cryptocurrencies play in helping Russia sanctions evasion and to what extent can this be?

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[Wind_FURY]

Hahaha. The Russians being sanctioned couldn't make Bitcoin's fundamental thesis, and main value-proposition clearer for the public. Governments use financial bans, and sanctions to control you. In this kind of world, we should be HODLing decentralized, censorship-resistant money.

[gantez]

The approval of bitcoin in Russia has no place to helping Russian economy at this time even if Putin is going to insue licences to mining just because he is under sanction.

Ukrainian Vice Prime Minister Mykhailo Fedorov demand crypto exchanges to freeze all Russian accounts so that the sanction can be effective, but most exchanges did not support this.

Ukraine has no power on exchanges that is not under there watch, not in their country and this is going to be impossible to achieve.

[Vaskiy]

The approval of bitcoin in Russia has no place to helping Russian economy at this time even if Putin is going to insue licences to mining just because he is under sanction.

Ukrainian Vice Prime Minister Mykhailo Fedorov demand crypto exchanges to freeze all Russian accounts so that the sanction can be effective, but most exchanges did not support this.

Ukraine has no power on exchanges that is not under there watch, not in their country and this is going to be impossible to achieve.

Russia could've made early-stage plans. No immediate issuance of licences on cryptocurrency mining gonna impact or make big changes to get rid of the sanctions. Right now to overcome the sanctions, the right way is to end the war and make talks and conclude with some treaty.

Ukraine on the other side benefits out of the decentralised infrastructure receiving donations and it wanting to have control over the Russians crypto accounts disturbs the true meaning of decentralisation.

[Upgrade00]

What is your take? What role can cryptocurrencies play in helping Russia sanctions evasion and to what extent can this be?

Cryptocurrencies while being a decentralized asset/currency cannot help Russia or any country evade international sanctions.

Popular payment systems; VISA, MasterCard, American Express have all declared that international payments from Russia would be halted, and this came after U.S. and some E.U. countries blocked certain banks in Russia from SWIFT, all of these sanctions would not be evaded by bitcoin or any other cryptocurrency, it can help the citizens escape economic collapse and have an alternative payment system, but cannot shield the country from the effects.

Stopping the war would be the fastest way to lift those sanctions, but Russia do not look to be considering that now after hinting at a partnership with a Chinese payment system.

[Wexnident]

It's more like helping them keep their money safe no? But technically the economy of the country would be rather out of hand already and sanctions would have already been applied to it, whether they want it or not. To make a comparison, it's like Bitcoin is a getaway method for them to escape a burning place, but when they come back, the place would still be burned down. Might've been the best option for the rich to keep themselves from being rich, but certainly not an option for the country itself to survive on it.

[Dunamisx]

Russia can attempt to use cryptocurrencies to evade sanctions

For his mind (Putin). Do you even know that about 25,000 Russians account has been placed on ban from one of the populous exchange coinbase and this is as a result of strict adherence in following the call on sanction placed on Russia.
https://en.cryptonomist.ch/2022/03/08/coinbase-blocks-25000-russian-accounts/?utm_source=thecryptoapp

[pooya87]

That's not how sanctions work.
Let's imagine the sanction on Russian gas/oil. If Europe is starving for gas and aren't allowed to buy it from Russia they will not buy it from Russia. Cryptocurrencies don't even come in! Similarly if the starving European countries decided they have no other choice to buy Russian gas they will buy it again there is no cryptocurrencies involved!
That's the same with anything else that was sanctioned.

What bitcoin can help with is when regular people are being sanctioned by the orchestrators of the financial terrorism, can easily use a currency that nobody can take from them or can dictate where they can use that money.

[Oasisman]

What is your take? What role can cryptocurrencies play in helping Russia sanctions evasion and to what extent can this be?

Stopping the war would be the fastest way to lift those sanctions, but Russia do not look to be considering that now after hinting at a partnership with a Chinese payment system.

This is exactly what the Russian government are up to.
However, news outlets like CNN tell differently as If China has no plans on helping Russia ease the economic sanctions, but has not participated in the sanctions as well.
We all know that China will eventually do something for the payment system.
While, cryptocurrency and Bitcoin may not going to work to help "evade" the economic sanctions in Russia. However It can help an individual to by pass the suspension of the Russian banks caused by the economic sanctions.

[_act_]

Ukraine on the other side benefits out of the decentralised infrastructure receiving donations and it wanting to have control over the Russians crypto accounts disturbs the true meaning of decentralisation.

Cryptocurrencies can be decentralized but centralized exchanges and centralized wallets are not decentralized, only centralized exchanges and wallets is what I are talking about. For people that are using decentralized wallets, there is nothing because the have the control, not the exchanges. But Russians can turn to decentralized means though.

Cryptocurrencies while being a decentralized asset/currency cannot help Russia or any country evade international sanctions.

This is what I am most thinking about too, I have been thinking of ways cryptocurrencies can help Russia to evade sanction but I still got no clue to it. Also that if the sanction continues, there would be alternative means for Russia to make those sanctions not effective like before, like alternative payment system to Swift and also trading more with China and other Asia countries.

I think I will prefer Chainanalysis report than any other one, but Chainanalysis prefer to report on what has happened ready and how it happened.

[Gozie51]

Stopping the war would be the fastest way to lift those sanctions, but Russia do not look to be considering that now after hinting at a partnership with a Chinese payment system.

I read yesterday that the Russian Army has announced temporal ceasefire to allow for evacuation of civilians after both countries accused themselves of not obeying such agreement earlier. I think that bitcoin adoption or not shouldn't be Putin's priority now but to enter into peaceful dialogue and negotiation to end the war and only that can peace and economic rebuilding will come to Russia but for now EU is not ready to back down on those sanctions and Russian economy will keep going down even if they start trading with China, cost variation will be very wide from trading with follow EU members.

[Fivestar4everMVP]

In my opinion, Russia can only evade sanctions through cryptocurrencies if crypto exchanges don't join the sanction which I highly doubt as the sanctions from crypto exchanges against Russia have started already started with coinbase blocking 25,000 accounts linked to Russia.
The only way I think crypto currencies can help Russia to evade the economical effects from the world sanctions is if they build their own crypto exchange(s), but even at this, the hope is still very little because the world will still boycott that exchange and its growth will be completely dwarfed.
It's a hard situation for Russia and it seems they are yet to come to terms with this reality, the world is wired in a way that we all require support from each other to move ahead, and breaking away from that support is suicidal, Russia will soon realize this, except they turn and make amends.

[Moneyprism]

cryptocurrency cannot be used by Russia to evade sanctions from the US and its allies. Cryptocurrencies will only be an alternative to help their economy but not in the long term, still banking-based payments are needed.

... but President Putin's move to use cryptocurrencies is commendable because it will help the development of the crypto market and its adoption today

[Wind_FURY]

That's not how sanctions work.

Let's imagine the sanction on Russian gas/oil. If Europe is starving for gas and aren't allowed to buy it from Russia they will not buy it from Russia. Cryptocurrencies don't even come in! Similarly if the starving European countries decided they have no other choice to buy Russian gas they will buy it again there is no cryptocurrencies involved!
That's the same with anything else that was sanctioned.

What bitcoin can help with is when regular people are being sanctioned by the orchestrators of the financial terrorism, can easily use a currency that nobody can take from them or can dictate where they can use that money.

Unless Russia uses Iran's work-around strategy to bypass sanctions on their oil exports. They can use their oil to power Bitcoin mining farms, and sell those freshly minted "virgin Bitcoins" at a premium.

It can help with SWIFT/financial sanctions if Russia itself wanted to transact using an open, permissionless ledger like Bitcoin. They can use that as leverage in weakening political strongholds. "You want Russian gas? Pay us in Bitcoin, or tell the U.S. to remove financial sanctions".

[NeuroticFish]

All this crypto for evading sanctions by Russia is false drama, talking about peanuts.
Russia doesn't need crypto to evade sanctions. As long as many countries still buy oil and gas from Russia, no matter the war, even fiat is flowing pretty muck OK.

And do you really expect the bigger whales from Russia have all their money in Russia? It's hidden in various countries, I'm sure.
Do you really think they cannot hire somebody from any country exchange that money into crypto for them?!


PS. What Coinbase did was cheap PR in the face of the govt (they never cared much of bitcoiners, didn't they?)

[Gozie51]

... but President Putin's move to use cryptocurrencies is commendable because it will help the development of the crypto market and its adoption today

It won't be commendable because everybody know it is for selfish purpose, purpose for just to run off from the effect of sanction, purpose of just survival and not for the real purpose of freedom of choice and adoption of open source system through blockchain. And purpose of possible denouncing bitcoin when situation is gone back to normal. Bitcoiners and crypto ethusiast are snarter than believing the use of bitcoin for selfish means.

[giammangiato]

The Russia's central bank wanted cryptocurrencies to be banned in its country but the Russian president, Vladimir Putin said bitcoin mining and other crypto mining will be beneficial for Russia. Some people at that time have been supectimg this could be a move by the Russia's president that he is planning to invade Ukraine which will result to sanctions, thinking cryptocurrencies would be a means to evade sanctions and make it economically less effective.

Ukrainian Vice Prime Minister Mykhailo Fedorov demand crypto exchanges to freeze all Russian accounts so that the sanction can be effective, but most exchanges did not support this. I read few days ago that cryptocurrencies may not help in Russia sanction but FinCEN concluded that Russia can attempt to use cryptocurrencies to evade sanctions.

FinCEN Provides Financial Institutions with Red Flags on Potential Russian Sanctions Evasion Attempts

What is your take? What role can cryptocurrencies play in helping Russia sanctions evasion and to what extent can this be?

The only way to circumvent the sanctions is to make bitcoin a primary currency like the ruble, so if Russia becomes like El Salvador they have a chance to evade the problem, apparently from the news they have learned they do not have this intention at the moment. But Putin is not stupid, he will surely have studied a plan to deal with these sanctions, obviously there are also other cryptocurrencies that can be used so turning the problem is feasible but not easy!

[Etranger]

I very much doubt that cryptocurrencies can help the Russian economy in this situation. Their implementation and legalization, the "tying" of economy under crypto takes time and targeted government action, and now Russia can not afford it, because it is busy waging war against Ukraine and shooting civilians. I see their appeal to cryptocurrencies as an attempt to be inspired before death. They see that sanctions are killing their economy. It is only necessary to understand that only a complete withdrawal of troops from the independent territory of Ukraine can save it, and not an attempt to patch up a leaky ship with Bitcoin.

[noorman0]

There is a contradictory analysis of "Cryptocurrency will not save Russia from sanctions" and I kind of agree with that.
The vice prime minister of Ukraine is also trying to maximize global economic sanctions against Russia in various ways, including efforts to identifying the crypto addresses of Russian politicians that may be a loophole to avoid sanctions.

Ukrainian crypto community is ready to provide a generous reward for any information about crypto-wallets of Russian and Belarusian politicians and their surroundings. War crimes must be pursued and punished!

Certain blockchain explorers can unilaterally flag suspicious addresses.

[cheezcarls]

Cryptocurrencies can be decentralized but centralized exchanges and centralized wallets are not decentralized, only centralized exchanges and wallets is what I are talking about. For people that are using decentralized wallets, there is nothing because the have the control, not the exchanges. But Russians can turn to decentralized means though.

Even from Binance CEO Changpeng Zhao himself saying that cryptocurrencies won’t help evade sanctions.  

But from my own perspective, Russia can possibly evade sanctions if they turn towards full decentralization or exchanges refusing to ban Russians from using their respective platforms. Like for instance, mandating all businesses to accept crypto payments by using non-custodial wallets.