When Stablecoins Get Sanctioned, Bitcoin Proves Why It’s Different

[Hypnosis00]

The EU is reportedly planning to sanction A7A5, a ruble-backed stablecoin created with support from a Russian state-owned bank. They’re worried it’s being used to bypass sanctions and facilitate international transactions outside of traditional banking systems.

It’s interesting because this shows how governments can easily target or restrict centralized stablecoins, especially those tied to a specific currency or state.
Unlike Bitcoin, these coins depend on issuers, reserves, and regulatory permission, all of which can be frozen or sanctioned at any time.

So the question now is:

If a single government-backed stablecoin can be blocked this easily, doesn’t that highlight why Bitcoin remains the only truly borderless, censorship-resistant asset?
Or do you think in the future, even Bitcoin could face similar geopolitical pressure if governments start coordinating stricter controls?

[_act_]

A7A5 is a stable coin backed by Russia rouble.

The token is not under EU sanction yet but it was under United States sanctions since August.

The token marketcap grew to over $500 million now and maybe they are afraid already that it can become something big.

If a single government-backed stablecoin can be blocked this easily, doesn’t that highlight why Bitcoin remains the only truly borderless, censorship-resistant asset?

Yes, they can be blocked easily but just on exchanges and centralized places. It also depends on people, example is monero that was blocked but people are still using it. That can be different for A7A5 because it is more political and there could be regional biases about it.

Or do you think in the future, even Bitcoin could face similar geopolitical pressure if governments start coordinating stricter controls?

No.

[hugeblack]

Sanctions and bans do not necessarily mean the blockchain will stop working, but they will make it more difficult to buy/selll tokens, thus reducing demand, negatively impacting the price.
If the government gains access to central servers, it can stop the blockchain.

In the case of Bitcoin, governments can launch sabotage attacks and force mining pools to comply with blacklists.

[Alpha Marine]

I guess they can do that to Bitcoin too, but the difference is, if they do that, they (the EU) will feel it too. I mean, the way they can sanction the token is to make people from the EU not accept, trade or have anything to do with the token. If Russia were using Bitcoin, it could make the same laws in their country, but since BTC is more global, it would be like punishing themselves too.

I think the Russian government is playing games here because nobody has been able to confirm the actual circulating supply or the market cap of the token; it was all self-reported by the project. A stablecoin that was launched in January and whose market cap increased by 250% in a day is fishy, though.

[aoluain]

If a single government-backed stablecoin can be blocked this easily, doesn’t that highlight why Bitcoin remains the only truly borderless, censorship-resistant asset?

Yes. Any currency created by a government remains in their control. They can
manipulate it, others can attack it and make it difficult for others to deal in it
and we all know Bitcoin offers an alternative to that.

Or do you think in the future, even Bitcoin could face similar geopolitical pressure if governments start coordinating stricter controls?

No, what can be controlled to a certain degree is the on and off ramp to and
from Bitcoin - not sure how effective that would be. Controls on Bitcoin itself -
how? they havent been able to do it so far and qnyway they are not going to harm
their wealthy ETF buddies.

[Ziskinberg]

I guess they can do that to Bitcoin too, but the difference is, if they do that, they (the EU) will feel it too. I mean, the way they can sanction the token is to make people from the EU not accept, trade or have anything to do with the token. If Russia were using Bitcoin, it could make the same laws in their country, but since BTC is more global, it would be like punishing themselves too.

It’s not gonna happen with Bitcoin since it’s already widely accepted and regulated, especially in the US. this stablecoin from Russia got sanctioned mainly because of the country behind it, that’s really the only distinction I can think of.

[ultrloa]

Sanctions and bans do not necessarily mean the blockchain will stop working, but they will make it more difficult to buy/selll tokens, thus reducing demand, negatively impacting the price.
If the government gains access to central servers, it can stop the blockchain.

Maybe people are confused about that situation but actually they can access it if they would use some tools like VPN. I think buying will not affected on this since somehow they can buy Bitcoin on other third party merchants outside on their jurisdictions. The selling will be hard to do especially that merchants would provably stops accepting Bitcoin and crypto transactions. Only p2p might come up but its hard to find reliable guys near us.

In the case of Bitcoin, governments can launch sabotage attacks and force mining pools to comply with blacklists.

This is extreme attempt to blowout blockchain and I think some government won't do this since they might get an issue for some countries that adopting or using Bitcoin for their daily transactions.

[betswift]

It’s not gonna happen with Bitcoin since it’s already widely accepted and regulated, especially in the US. this stablecoin from Russia got sanctioned mainly because of the country behind it, that’s really the only distinction I can think of.

The cons for doing that with BTC would be much bigger in the perspective: many understand already how things may be done properly with BTC, so they won't miss a chance to have a nice chunk of profit rather than banning / sanctioning it.

[Botnake]

If sanctions happen, exchanges will delist their coins, so it won't be as popular as other stablecoins. that's what governments can do, but people can still use it since it's on the blockchain. even before it was created, we already knew countries not allied would sanction or already did, so anything they make to bypass those sanctions, the ones imposing them (EU, US) will find a way to counter.

Maybe they should just use Bitcoin.

[betswift]

If sanctions happen, exchanges will delist their coins, so it won't be as popular as other stablecoins. that's what governments can do, but people can still use it since it's on the blockchain. even before it was created, we already knew countries not allied would sanction or already did, so anything they make to bypass those sanctions, the ones imposing them (EU, US) will find a way to counter.

Maybe they should just use Bitcoin.

That's why DEXes are there for the people and bigger whales alike..I heard some of them are not that bad, even though sometimes their convenience is not as good as on CEXes.

[Hypnosis00]

If the government gains access to central servers, it can stop the blockchain.

In the case of Bitcoin, governments can launch sabotage attacks and force mining pools to comply with blacklists.

Mmm… this is really possible, but I’m just curious though -- has it ever happened before where a government was actually able to stop a blockchain that uses a centralized server?

[fikrett]

If the government gains access to central servers, it can stop the blockchain.

In the case of Bitcoin, governments can launch sabotage attacks and force mining pools to comply with blacklists.

Mmm… this is really possible, but I’m just curious though -- has it ever happened before where a government was actually able to stop a blockchain that uses a centralized server?

You can google the situation with Infura on ETH network around 2020-ish years.

They were the AWS of the ETH ecosystem, so to speak (quoting Raul Marcos ), and they were affected by ETH outage, and exchanges were affected too.

But I didn't hear about govs outright stopping someone's chain.

[Wakate]

I keep seeing news like Russian backed... sanctioned which is ridiculous. Why is the US and the European countries like sanctioning anything that belongs to Russia. The last time I checked, I saw on the news where Europe was planning to loan Ukraine part of the Russian seized fund which was quite funny. Why does the Western part of the world hate Russia this much? Is it because they are NATO countries? So pathetic and absurd.

Bitcoin is not safe too because their are countries that are sanctioning their citizens if they ever use Bitcoin. It all depends on the government and what they want their people to have access to.

[Cryptomultiplier]

The EU is reportedly planning to sanction A7A5, a ruble-backed stablecoin created with support from a Russian state-owned bank. They’re worried it’s being used to bypass sanctions and facilitate international transactions outside of traditional banking systems.

It’s interesting because this shows how governments can easily target or restrict centralized stablecoins, especially those tied to a specific currency or state.
Unlike Bitcoin, these coins depend on issuers, reserves, and regulatory permission, all of which can be frozen or sanctioned at any time.

So the question now is:

If a single government-backed stablecoin can be blocked this easily, doesn’t that highlight why Bitcoin remains the only truly borderless, censorship-resistant asset?
Or do you think in the future, even Bitcoin could face similar geopolitical pressure if governments start coordinating stricter controls?

The fact that such a stable coin can be sanctioned and restricted highlights a very distinct difference between centralized stablecoin and decentralized Bitcoin.

While we may say that stablecoins issuer is always from a single and easily identified point of failure, hence why it can be easily traced and sanctioned, Bitcoin lacks such an issuer and any such sanctions that is brought Bitcoin's way, only affects the exchanges but can't affect an individual or investors holdings nor stop them from transferring their Bitcoin to and from a non custodial wallet.

The fact of decentralization that Bitcoin was built on, is the strong defense it has against any form of government restrictions or financial censorship that exist out there today.

[Spaceman1000$]

I keep seeing news like Russian backed... sanctioned which is ridiculous. Why is the US and the European countries like sanctioning anything that belongs to Russia. The last time I checked, I saw on the news where Europe was planning to loan Ukraine part of the Russian seized fund which was quite funny. Why does the Western part of the world hate Russia this much? Is it because they are NATO countries? So pathetic and absurd.

Bitcoin is not safe too because their are countries that are sanctioning their citizens if they ever use Bitcoin. It all depends on the government and what they want their people to have access to.

What i see is more of political interest been displayed, hence politics gets involves, the entire scene becomes a different thing. When sanctions of this nature happens, is not really about the interest of the ordinary People, is always all about political supremacy and the need to conquer your suppose enemies territory. Those countries that put sanction on Bitcoin, would you say is entirely for the interest of the  ordinary people, of course no, is just selfish interest and the need for the populist to be under the financial control of the government in power.

[dzungmobile]

The EU is reportedly planning to sanction A7A5, a ruble-backed stablecoin created with support from a Russian state-owned bank.

If a single government-backed stablecoin can be blocked this easily, doesn’t that highlight why Bitcoin remains the only truly borderless, censorship-resistant asset?
Or do you think in the future, even Bitcoin could face similar geopolitical pressure if governments start coordinating stricter controls?

Without this sanction, you can know of risk of stable coins in general and this big issue was discussed many years ago.

Stable coins and black lists.
PSA: Most Stablecoins Can Be Frozen, Even in Your Own Wallets.
Tether minted more USDT.
Tether (USDT) - Backed by Air and Words

This sanction is against Russia by its war and invasion into Ukraine but it is possible to do only because of smart contracts allow freezing stable coins in any address.

[arzuo]

As my opinion government never interest to accept stable coin if the don't like btc , Because it will weak govt money and govt power which government create by money inflation so if they accept stable coin then not able to inflation and not control power. 

If any government want to accept it that means they are in right way and their government is stay in pure policy.
So at least that mean btc is a BTC machines  to provide and present about honest and honest govt policy.   
 

[lionheart78]

Sanctions and bans do not necessarily mean the blockchain will stop working, but they will make it more difficult to buy/selll tokens, thus reducing demand, negatively impacting the price.
If the government gains access to central servers, it can stop the blockchain.

In the case of Bitcoin, governments can launch sabotage attacks and force mining pools to comply with blacklists.

True, in short, Bitcoin is not invincible; the government, if wanted to sanction Bitcoin-related activities, can just pass a resolution or regulation that can suppress its core activities, like the one you stated, mining, exchanges, and other Bitcoin infrastructure.

The Bitcoin network, although decentralized, often involves a centralized platform in order for it to be used in real life.  This is where the point of failure may come in and the government can take advantage of this to suppress Bitcoin and its adoption and usage.

The Bitcoin network may continue to work but the government can track ISP's and other information that can lead to people supporting the Bitcoin network and impose penalties to service providers that allow Bitcoin to continue its activity.

So IMO, yes Bitcoin is also at risk of government sanctions if the government is serious enough to take down Bitcoin.

But I didn't hear about govs outright stopping someone's chain.

The government does not need to stop the chain, they only need to control the centralized platform that allows that chain to proliferate, and or track people who make use of it for "illegal stuff".  If people can't find any use of a chain, they will abandon it, and the chain itself can die in natural way.  Just like any other altcoin that sprout and die in the history of the cryptocurrency.

[viljy]

If a single government-backed stablecoin can be blocked this easily, doesn’t that highlight why Bitcoin remains the only truly borderless, censorship-resistant asset?
Or do you think in the future, even Bitcoin could face similar geopolitical pressure if governments start coordinating stricter controls?

Why is it easy to block? In the ETH and TRON blockchains, no one can block this token. Europe also cannot accuse and arrest Justin Sun or Vitalik Buterin
Some exchanges will not comply with European sanctions.
In general, there is no point in speculating about this, since a war between Russia and NATO is inevitable in 2-3 years with a 90% probability. And it's going to be a big nuclear war. So such problems will seem like a trifle to any person. We need to think about life and death, not about stablecoins.

[Dogedegen]

If a single government-backed stablecoin can be blocked this easily, doesn’t that highlight why Bitcoin remains the only truly borderless, censorship-resistant asset?
Or do you think in the future, even Bitcoin could face similar geopolitical pressure if governments start coordinating stricter controls?

Why is it easy to block? In the ETH and TRON blockchains, no one can block this token. Europe also cannot accuse and arrest Justin Sun or Vitalik Buterin

A block is not a seize or a freeze. Generally when you talk about block it means disallowing its use somewhere, it does not necessarily mean disallowing it everywhere which is not possible. Europe can force any exchange that is allowed to operate within its jurisdiction to not accept it. This is effectively a block as wide as possible.

Some exchanges will not comply with European sanctions.

Shady exchanges are generally not worth mentioning. Legitimate exchanges have no choice but to comply.

As my opinion government never interest to accept stable coin if the don't like btc , Because it will weak govt money and govt power which government create by money inflation so if they accept stable coin then not able to inflation and not control power.  

A government controlled stablecoin can be inflated at any time by any amount. You are mistaken. They would have even more power than they do now.