In light of recent European sanctions against Russia, Binance, the world’s largest crypto exchange, claimed it was forced to ban trading activity of Russian users.
Russian entities with crypto assets worth more than 10,000 euros ($10,893) would have their services limited, according to the exchange. These accounts will be unable to trade or deposit tokens, and will only be able to withdraw their funds.
Binance added that deposits into Russian accounts that fit within this category will also be prohibited. All Russian nationals and entities resident in Russia are subject to the rules.
The move comes after the European Union imposed a fifth round of sanctions on Russia in response to the latter’s invasion of Ukraine. The most recent penalties include asset freezes on a number of Russian businesses, as well as a ban on Russians receiving EU money.
Sanctions imposed in response to Russia’s invasion of Ukraine have virtually cut Ukraine off from the international financial system.
Binance’s latest action is a shift from the company’s previous stance on giving services to Russians. The exchange agreed to abide by sanctions imposed on Russian companies. It had, however, flatly refused to quit serving Russian citizens.
Binance, on the other hand, looks to be swimming against the current. The exchange had previously banned support for Visa and Mastercard cards in Russia after the two companies withdrew from the country earlier this year.
Coinbase CEO Brian Armstrong called crypto a “lifeline” for many Russians, and other crypto exchanges had likewise rebuffed calls to discontinue Russian services. It’s unclear how other exchanges will deal with the additional penalties right now.
The general assumption is that Moscow will be unable to use cryptocurrencies to circumvent tough sanctions. However, this hasn’t stopped the country from stepping up its crypto acceptance efforts.
A proposed bill would make certain types of cryptocurrency legal tender. In addition, the measure aims to create a broad regulatory framework for cryptocurrency in Russia.
The Russian government reportedly plans to use its vast energy reserves to mine additional cryptocurrency. It will create an official list of miners and provide mining companies with subsidies.