New crypto sanctions imposed by the European Union are likely to spur the development of digital asset markets in the country, according to a Russian lawmaker. Anatoly Aksakov, who chairs the parliament’s Financial Markets Committee, believes the Russians will manage to circumvent the restrictions. Meanwhile, major exchanges have reportedly notified Russian users to continue trading.
Russians find ways around increasing European crypto sanctions, Duma member claims
This week, the EU adopted its eighth package of penalties intended to hit the government, economy, and energy exports to Russia in response to the recent escalation of military conflict in Ukraine and the annexation of Ukrainian territory. Also targeted was Russia’s access to cryptocurrency, which is seen as a tool for circumventing financial regulations and exporting wealth.
The Council of the European Union has completely banned the provision of crypto wallets, accounts, and custody services to Russian residents and entities. However, according to a high-ranking member of the Russian parliament quoted by TASS, the EU decision may actually stimulate the development of Russia’s digital financial assets (DFA) market.
This opinion was expressed by Anatoly Aksakov, head of the Financial Markets Committee of the State Duma, the lower house of the Russian parliament. He has been deeply involved in recent efforts to regulate the country’s crypto space, including the use of digital currencies in international payments. Authorities in Moscow have been discussing the issue for over a year and are currently considering extending the legal framework to primarily cover DFAs with issuers such as tokens.
The latest round of EU sanctions strengthens previously imposed restrictions. As part of the fifth package of measures approved earlier this year, a little more than a month after Russia launched its invasion of Ukraine, the 27-strong bloc restricted only “high-value” crypto asset services for Russians and Russian-registered organizations – with a fiat value of €10,000 (about $11,000 at the time, now for digital holdings in excess of $3,000 (less than $0.00).
Binance, Huobi comment on latest EU sanctions, no new restrictions so far
“Similar decisions have already been made earlier. They closed the official representative office of the crypto exchange in Russia, but virtually nothing has changed. Also, the office can be located in virtual space, not at some address in Moscow,” Anatoly Aksakov further elaborated, claiming that the Russians can easily circumvent the sanctions.
Binance, the world’s largest crypto exchange, which partially complied with previous EU requirements and allowed withdrawals only when Russian account balances exceeded 10,000 euros, is now telling users that it did not introduce new restrictions, Bits.media revealed in a report Bits.media reported that it is now telling users that it did not introduce any new limits. Another major platform, Huobi, said it would “continue to support stable transactions for Russian users.”
None of the top seven global crypto exchanges popular with Russians, which also include Bybit, Coinbase, FTX, Kraken, and Gate.io, are “European residents” for whom the measures are mandatory, the Russian crypto news outlet noted. defi Russian crypto experts like Sergey Mendeleev, CEO of banking platform Indefibank, doubt that most crypto companies will rush to implement the EU resolution targeting all Russian users as it will lead to loss of market position.
“Moreover, these restrictions stimulate the development of modern technology. Next year will be the year of digital financial assets in Russia, you will see,” Aksakov promised. His comments came as deputies in the State Duma prepare to adopt a new law “On Digital Currency” designed to regulate decentralized crypto assets such as Bitcoin and their employment in cross-border crypto payments between Russian companies and their foreign partners.
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