US Treasury Department Confirms Russia's Economic Sanctions Include Crypto Money And All Transactions

Cryptocurrency transactions are also prohibited under economic sanctions for Russia. (photo: doc. pixabay)

JAKARTA - The US Treasury's Office of Foreign Assets Control (OFAC) issued new guidance on Friday, March 11, clarifying that US citizens and digital asset companies are required to comply with sanctions against Russia. This sanction also applies to cryptocurrencies, so US companies are also prohibited from facilitating transactions in cryptocurrencies.

OFAC says in the guide that people in the United States as well as businesses dealing with cryptocurrencies should be wary of attempts to circumvent OFAC regulations. They must take risk-based steps to ensure they do not engage in illicit transactions.

The warning comes as much of the cryptocurrency industry responds to concerns from some lawmakers that digital assets could be used to evade Western sanctions imposed on Russia following its invasion of Ukraine.

Biden administration officials say they don't believe Russia will be able to use cryptocurrencies to completely evade sanctions, but still warn companies to be vigilant.

In guidance issued Monday last week, the Financial Crimes Enforcement Network (FinCEN) said crypto exchanges should report suspicious activity, but last Friday's notice, went so far as to state clearly that US companies are also prohibited from engaging in or facilitating illegal transactions.

Major crypto exchanges, including Coinbase and Binance, have not heeded orders to block Russian users, as several Ukrainian officials have requested.

Alex Bornyakov, Ukraine's Deputy Minister of Digital Transformation, told Reuters that cryptocurrency exchanges that choose to remain in Russia will face public backlash unless they reverse course.