Crypto Exchanges Under Pressure Amid Russian Invasion of Ukraine

According to the latest cryptocurrency news reports, Bitcoin and altcoin exchanges are under pressure to stand on Russia’s war in Ukraine.

They who advocate financial inclusion are under pressure to choose sides, after the Russian invasion of Ukraine was followed by sanctions from the United States, the European Union and the United Kingdom.

This pressure weakens their motto that they are borderless and do not discriminate unlike centralized finance.

But at the same time, they do not want to alienate either the regulators or some of their customers who support the Ukrainians through donations.

It is a real dilemma that cryptocurrency exchanges are facing, especially since they have been publicly challenged by the Ukrainian authorities.

“I’m asking all major crypto exchanges to block addresses of Russian users,” Ukrainian Vice Premier minister Mykhailo Fedorov posted on his Twitter account. “It’s crucial to freeze not only the addresses linked to Russian and Belarusian politicians, but also to sabotage ordinary users.”

Most of the established digital currency exchanges have rejected this request, while making it known that they have made donations to Ukraine.

Binance, the world’s leading crypto exchange, said it has donated $10 million to help Ukrainian people through United Nations organizations.

“I understand the rationale for this request but, despite my deep respect for the Ukrainian people, @krakenfx cannot freeze the accounts of our Russian clients without a legal requirement to do so,” Jesse Powell, CEO of crypto exchange Kraken responded on Twitter.

No Legal Basis to Block Russian Accounts

In general, cryptocurrency exchanges argue that they have no legal basis to deny access to Russians. But things may change if they receive directives from governments imposing sanctions on the Russians.

“Binance follows sanctions rules very strictly, whoever is on the sanctions list won’t be able to use our platforms,” Binance CEO Changpeng Zhao told Bloomberg TV.

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