Latest EU Sanctions Expected to Stimulate Russia’s Own Crypto Market, Exchanges Maintain Services – Regulation Bitcoin News

The new crypto sanctions imposed by the European Union are likely to stimulate the development of the country’s digital asset market, according to a Russian lawmaker. Anatoly Aksakov, who heads the parliamentary financial market committee, believes the Russians will be able to circumvent the restrictions. Meanwhile, major exchanges have reportedly informed Russian users that trading is continuing.

Russians find ways to circumvent mounting European crypto-sanctions, Duma member insists

This week, the European Union adopted its eighth package of sanctions against Russia, intended to hit the country’s government, economy and energy exports in response to the recent escalation of the military conflict in Ukraine and its annexation of Ukrainian territories. Russian access to cryptocurrency, seen as a tool to circumvent economic restrictions and export wealth, was also targeted.

The Council of the European Union completely banned the provision of crypto wallet, account and custody services to Russian residents and entities. However, according to a senior member of the Russian parliament quoted by the Tass news agency, the EU decision could actually stimulate the development of Russia’s digital financial assets (DFA) market.

The opinion was expressed by Anatoly Aksakov, head of the financial market committee of the State Duma, the lower house of the Russian parliament. He has been deeply involved in recent efforts to regulate the country’s crypto space, including the use of digital currencies in international settlements. Moscow authorities have been debating the matter for over a year, considering an expansion of the legal framework that currently mainly covers single-issuer DFAs, such as tokens.

The latest round of EU sanctions tightens previously imposed restrictions. Earlier this year, as part of the fifth package of measures approved just over a month after Russia launched its invasion of Ukraine, the 27-strong bloc restricted only “high-value” crypto-asset services to Russians and Russian-registered organizations – those for digital holdings exceeding €10,000 in fiat value (about $11,000 at the time, less than $10,000 now).

Binance, Huobi Comment on the latest EU sanctions, no new restrictions for now

– Similar decisions have already been made before. They closed the official representative offices of their crypto exchanges in Russia, but de facto nothing has changed. It can also be an office in virtual space, not at an address in Moscow,” Anatoly Aksakov elaborated further, insisting that Russians can easily circumvent the sanctions.

While the world’s largest crypto exchange, Binance, partially complied with the EU’s previous requirements, only allowing withdrawals in case Russian account balances exceed €10,000, it has now told users that it has not introduced new restrictions, Bits.media revealed in a report. Another major platform, Huobi, said it “continues to support stable trading with Russian users.”

Of the top seven global crypto exchanges popular among Russians, which also include Bybit, Coinbase, FTX, Kraken and Gate.io, no one is a “European resident” for whom the measures will be mandatory, the Russian crypto news outlet noted. Russian crypto experts, such as the CEO of the Defi Banking platform Indefibank, Sergey Mendeleev, doubt that most crypto companies will rush to implement the EU resolution aimed at all Russian users, as this will lead to a loss of market positions.

“Furthermore, these restrictions stimulate the development of modern technologies. Next year will be the year of digital financial assets in Russia, you will see,” promised Aksakov. His comments come as State Duma deputies prepare to adopt a new law “On Digital Currency” designed to regulate decentralized crypto assets such as bitcoin and their employment in cross-border crypto payments between Russian companies and their foreign partners.

Do you think the latest EU sanctions will accelerate the legalization of cryptocurrencies in Russia? Share your thoughts on the topic in the comments section below.

Lubomir Tassev

Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens’ quote: “To be a writer is what I am, rather than what I do.” Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.