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Experts noted that the belief that Russians could use cryptocurrencies to dodge sanctions may be false as the spike in the price of Bitcoin cannot be attributed to Russians buying more cryptos.
In compliance with the global sanctions raised against Russians for invading and launching destructive attacks on the residents of Ukraine, top South Korean cryptocurrency exchanges have decided to place a ban on the IP addresses of Russian-based users.
South Korean Exchanges Prohibit Russians From Crypto Services
According to a recent report from a local media outlet, a number of leading cryptocurrency exchanges in the South Korean region have decided to join the trend of institutions placing technical prohibitions on Russians as a way to support Ukraine in their defense over Russia’s attack.
On Thursday, South Korea’s largest cryptocurrency exchange by transaction, Upbit disclosed plans that it could start rejecting withdrawal request from IP addresses of Russian users. The announcement reads:
“We’ve blocked subscriptions by users in countries which are at high risks of money laundering, in line with guidelines of the Financial Action Task Force.”
In the same vein, other South Korean cryptocurrency exchanges like Bithumb, Korbit and Gopax had reportedly barred the IP addresses of their Russian clients. The latter announced on Wednesday that it had frozen about 20 crypto accounts registered by Russian citizens and has blocked IP addresses from Russia.
Russian Crypto Volume Plummets by 50% Despite Sanctions
Opinions suggest that Russians may adopt the use of cryptocurrencies to scale through the increasing economic sanctions placed on them. As such, the US and its allies have continued to intensify their sanctions against Russia and continue to make efforts to have them detached from the international financial system. New York is neither relenting on making technical efforts to frustrate Russians off their invasion on Ukraine. Speaking on the sanctions imposed on Russia, Kathy Hochul, the New York Governor said:
“New York is proudly home to the nation‘s largest Ukrainian population and we will use our technological assets to protect our people and show Russia that we will hold them accountable.”
However, recent reports unveil that the sanctions may have no expected impact on Russia’s use of cryptocurrencies as the Russian denominated crypto purchasing and trading on the world’s major exchanges have declined by 50% despite the intensified economic sanctions on the country.
Experts noted that the belief that Russians could use cryptocurrencies to dodge sanctions may be false as the spike in the price of Bitcoin cannot be attributed to Russians buying more cryptos.
“Russian volumes have been relatively small so far, suggesting that the price action is more due to investors positioning for an expected uptick in demand from Russia, rather than Russian demand itself,” explained Citigroup analyst Alexander Saunders.