While the United States and the European Union are taking steps to prevent Russia from using cryptocurrencies for possible sanctions evasion, some countries in Asia have also moved to respond to the situation.
Japan to fine crypto exchanges for violating sanctions
Japan became the last country in Asia to call on cryptocurrency companies to comply with sanctions against Russia, asking them on Monday not to process crypto transactions involving sanctioned individuals or entities in Russia and Belarus.
The Japanese Financial Services Agency (FSA) and the Ministry of Finance issued a joint statement on sanctions against Russia, highlighting that cryptocurrencies are part of the restrictions and that cryptoassets found to be sanction-related should be frozen.
The FSA has reportedly said that all unauthorized transactions under sanctions, including transfers of cryptocurrencies or non-fungible tokens (NFT), are subject to severe penalties such as imprisonment for up to three years or a fine of 1 million yen ($8,500).
The Japanese government’s latest sanctions warning came shortly after the European Union, the US and the G7 countries announced new actions targeting the Russian economy and wealthy individuals over possible attempts to circumvent sanctions using crypto.
Singapore Bans Crypto Fundraising For Russia
Other Asian countries such as Singapore are also moving to comply with sanctions against Russia. Singapore reportedly last week forbidden all local financial institutions to transact with sanctioned Russian banks and facilitate fundraising for the Russian government and related entities, with sanctions for transactions involving cryptocurrency, NFTs and other digital assets.
Executives at some crypto companies, such as crypto exchange Luno, reportedly suggested that most crypto companies in Singapore are unlikely to have direct business relationships with individuals or entities based in Russia. ADDX, a crypto-enabled private market exchange in Singapore, also said the fund has not been affected by sanctions against Russia.
“We conduct Know Your Customer and Anti-Money Laundering checks on all of our investors, which is why we do not handle anonymous transactions,” said Oi-Yee Choo, CEO of ADDX.
Major crypto exchanges in South Korea are blocking Russian IP addresses
Previously, South Korea also joined global sanctions against Russia, with several local cryptocurrency exchanges blocking IP addresses or Russian users.
According to a report from local Yonhap news agency, major South Korean exchanges, including Upbit blocked recordings of IP addresses linked to Russia from March 3. Other local crypto exchanges such as Gopax, Bithumb, and Korbit also restricted access to platform accounts from Russian IP addresses.
While some countries are going to restrict crypto transactions due to links to potential sanctions evasion, other governments are reportedly turning to cryptocurrencies as they appear to be one of the few options for Russians to pay for services abroad amid massive global warming. sanctions.
Thai association proposes to let Russians pay in crypto because other payment methods are blocked
On March 8, Phuket Tourist Association president Bhummikitti Ruktaengam reportedly said that the group was in talks with the Bank of Thailand about potentially adopting cryptocurrency as an alternative payment option for Russian tourists trapped in the country due to sanctions.
As before, Russians could no longer use their Mastercard and Visa debit and credit cards abroad after the payment giants decided to cut aid to all Russians as part of the sanctions.
“Cryptocurrencies would serve as a backup while transactions could not go through,” Bhummikitti noted.
Must be very frustrating for Russians outside of Russia as they can’t use their cards issued by Russian banks that use Visa and Mastercard to pay. There is now a proposal in Thailand to allow them to use crypto to pay for stuff. https://t.co/4MJsOxElI4
— (@ayshardzn) March 9, 2022
While regulators around the world have been actively moving to limit Russia’s chances of potentially circumventing sanctions with crypto, some local lawmakers have also begun to see crypto as a tool to potentially avoid some of the restrictions.
Related: Bitfinex Refuses To Freeze Crypto From Unsanctioned Russians
On Sunday, the Russian State Duma deputy Alexander Yakubovsky suggested that Russia should set up and use its own crypto exchanges to mitigate the impact of global sanctions on Russia.
“Crypto is an area where it is difficult to talk about really effective restrictions against our country,” Yakubovsky said in an interview with the local news agency Parlamentskaya Gazeta. As previously reported, the Russian authorities deliberately limited the service of legal crypto exchanges only to foreign companies such as Binance, while the Bank of Russia deliberately restricted local financial companies from offering crypto investments.