US imposes sanctions on Russian bank, individuals
Cryptocurrency mining firm targeted
WASHINGTON, April 25, (KUNA): The US imposed sanctions on a bank, a global network of individuals and entities accused of sanction evading and a cryptocurrency mining company from Russia.
The sanctions target Russian commercial bank Transkapitalbank and a network of more than 40 individuals and entities led by US-designated Russian oligarch Konstantin Malofeyev, alongside Russian cryptocurrency mining company Bitriver.
Malofeyev allegedly funded separatist activities in Eastern Ukraine and was one of the main sources of financing for Russians promoting separatism in Crimea, read a Treasury statement.
The Treasury added that Moscow is monetising its natural resources through virtual currency, adding it would block the sale of computer equipment and fiat payments used to launch these operations.
Washington is also imposing visa restrictions on 635 Russian nationals, alongside three Russian officials for alleged involvement in “gross violations of human rights” and on 17 individuals for undermining democracy in Belarus.
The sanctions include the first set of penalties against a cryptocurrency mining firm in relation to the war.
In a first, the U.S. government issued penalties against a cryptocurrency mining firm in relation to the war.
Digital currency firm Bitriver AG and 10 of its subsidiaries were included in Wednesday’s package of sanctions from Treasury’s Office of Foreign Assets Control.
“The United States is committed to ensuring that no asset, no matter how complex, becomes a mechanism for the Putin regime to offset the impact of sanctions,” Treasury said in a statement.
Lawmakers and administration officials have voiced concerns that Russia may be using cryptocurrency to avoid pain from the avalanche of sanctions imposed on banks, oligarchs and the energy industry in recent months due to the invasion.
Experts say an increased reliance on cryptocurrency would be an inevitable avenue for Russia to try to prop up its financial transactions, but Treasury officials have rejected the claim that cryptocurrency could be a major driver of sanctions evasion.
Adam Zarazinski, CEO of Inca Digital, a crypto data company that does work for several federal agencies, says he predicts more penalties against cryptocurrency miners and firms could be forthcoming, as oligarchs and sanctioned individuals find ways to offload their money to avoid sanctions impacts.
He added that the sanctions may not have as grave an impact on Bitriver as the U.S. hopes, because even though Bitriver was sanctioned by the U.S. government, “it doesn’t actually stop Bitriver from doing business - it can no longer interact with the U.S. financial system,” he said.
In a statement that was released shortly after the sanctions became public, Treasury Secretary Janet Yellen said “Russia’s invasion is an assault on fundamental international rules and norms and threatens the core of the international order.”
“The United States stands resolutely with the Ukrainian government and the Ukrainian people.”
The statement was released in connection with the joint International Monetary and Financial Committee and Development Committee meeting related to the International Monetary Fund and World Bank spring meetings.