With the war between Russia and Ukraine, the power that bitcoin (BTC) and other cryptocurrencies can have in the financial system has become evident, to the point that the United States and the European Union (EU) desperately seek to regulate the assets. digital so that Moscow does not benefit from them. Their goal is to block your access to industry-related platforms.
From various US and European sectors the idea of regulating cryptocurrencies gains more strength. Yesterday, the president of the Federal Reserve (Fed), Jerome Powell, broached the subject of Ukraine and Russia in the United States Congress.
Powell said there is a need for “a framework in particular, with ways to prevent these unbacked cryptocurrencies from serving as a vehicle for terrorist financing and general criminal behavior — tax evasion and the like.”
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Separately, Senators Elizabeth Warren, Mark Warner, Jack Reed, and Senate Banking Committee Chairman Sherrod Brown sent a missive Treasury Secretary Janet Yellen. In the letter they asked for explanations about the actions being taken by the Treasury Department with respect to cryptocurrencies in the context of sanctions policy, especially against Russia.
The senators expressed that they are “concerned that criminals, rogue states, and other actors may use digital assets and alternative payment platforms as a new means of concealing cross-border transactions for nefarious purposes.”
They have said that their restlessness continues to grow given the current scenario with Russia. “Russian entities are preparing to mitigate some of the worst effects” of the sanctions that have been placed on the country by using the variety of “cryptocurrency-related tools at their disposal.”
New US measures against Russia and its access to cryptocurrencies
The Treasury’s Office of Foreign Assets Control (OFAC) also exposed a document called Russia’s Harmful Foreign Activity Sanctions Regulations, which went into effect, yesterday, March 2.
This will allow the United States to take action against transactions, including made with cryptocurrencies by banned Russian entities.
The rule encompasses all “deceptive or structured transactions or dealings to circumvent any United States sanctions, including through the use of digital currencies or assets or the use of physical assets.”
The president of the United States himself promoted a measure to prevent exchanges from helping Bitcoin and other cryptocurrencies to be an escape valve for sanctioned Russian individuals and organizations, such as reported CriptoNoticias.
From Europe they also plan to prevent Russia from using bitcoin to block bitcoin to Russia
Along the same lines as the United States, the European Union (EU) is also discussing measures that block the use of cryptocurrencies in Russia. This, at a time when the economy of the Eurasian country takes big hitsto the point that the European subsidiary of Sberbank, the main Russian bank, would be in “bankruptcy or probable bankruptcy”, according to statements by the European Central Bank (ECB).
French Finance Minister Bruno le Maire said that the EU wants to prevent Russia from circumventing the sanctions imposed by using cryptocurrencies.
“We are taking measures, in particular on cryptocurrencies or crypto assets, which should not be used to circumvent the financial sanctions decided by the 27 EU countries,” the French official commented.
He added that the sanctions have had an effect on Russia, hitting the financial structure of that country and leaving its central bank with no opportunity to protect the ruble, the Russian national currency.
According to a research of CriptoNoticias, it was possible to determine that the ruble has fallen 24% against the US dollar in a week. Taking into account that bitcoin has rallied in the past seven days, the total ruble in circulation is now worth less than bitcoin’s market capitalization in dollars.
For his part, the German Finance Minister, Christian Lindner, said that the G7, is also considering taking more steps to “prevent listed individuals and institutions from switching to unregulated crypto assets. We are working to achieve this in the context of the German presidency of the G7.” according the Archyde.com agency.
The sanctions that may arise with the passing of days from Europe and the United States, are born after, on February 28, Ukraine requested support to round up cryptocurrency users located in Russia. In addition, he called for all Russians to be blocked from cryptocurrency exchanges, Visa, MasterCard payment systems, and even metaverses.