Coinbase has joined the list of cryptocurrency exchanges that do not plan to block Russia-based users from accessing their services. The company’s CEO believes that oligarchs won’t be able to use digital assets, while many ordinary Russians could buy crypto while their national currency tumbles.
Coinbase will not ban customers based in Russia
As the Russian president launched a ‘special military operation’ against Ukraine, which turned out to be a simple war, Western powers – including the US and EU – decided not to get involved directly. Instead, they started sending military equipment and funds and started taking in the millions of refugees.
As far as Russia is concerned, most countries imposed severe sanctions, the majority of which were financial. Amid these were Russian banks getting cut off SWIFT. Some people even started requesting cryptocurrency exchanges to follow suit and ban Russian-based customers from accessing their platforms. They argued that oligarchs could employ the asset class to bypass the financial sanctions.
While some South Korean companies reportedly decided to comply, others, like Binance and Kraken, refused, indicating that such a move would go against the core values of the crypto industry.
Coinbase CEO, Brian Armstrong, joined the second club. He believes the risk of Russian oligarchs utilizing crypto to avoid sanctions is rather small. This is because digital assets use blockchain where every transaction is recorded and visible, meaning that “trying to sneak lots of money through crypto would be more traceable than using US dollars cash, art, gold, or other assets.”
Still, Armstrong has pledged to block transactions from IP addresses that may “belong to sanctioned individuals or entities, like any other regulated financial services firm.”
Ordinary Russians Can Benefit
While joining Ripple CEO Brad Garlinghouse in refuting the idea that oligarchs can indeed use crypto to bypass sanctions, Armstrong noted that ordinary citizens can view the asset class “as a lifeline now that their currency has collapsed.”
Indeed, the Russian ruble lost around 30% of its value against other fiat currencies a few days after the start of the war. Soon after, reports emerged indicating that bitcoin and crypto trading volumes from Russia (and Ukraine) had reached new highs.
However, Armstrong warned that Coinbase’s stance could change in the future, saying, “if the US government decides to impose a ban, we will, of course, follow those laws.”
