Binance and Kraken rejected to block Russian users as request from Ukraine’s Vice Prime Minister
Deputy Prime Minister of Ukraine Mykhailo Fedorov yesterday ordered major cryptocurrency exchanges to freeze Russian accounts. Both Kraken and Binance have declined.
Exchange resists the call to freeze Russian ordinary accounts
Binance and Kraken rejected a request from the Deputy Prime Minister of Ukraine to block Russian users. Yesterday, Deputy Prime Minister of Ukraine, Mykhailo Fedorov, called on crypto exchanges to block Russian users, writing:
“I’m asking all major crypto exchanges to block addresses of Russian users. It’s crucial to freeze not only the addresses linked to Russian and Belarusian politicians but also to sabotage ordinary users.”
I’m asking all major crypto exchanges to block addresses of Russian users.
It’s crucial to freeze not only the addresses linked to Russian and Belarusian politicians, but also to sabotage ordinary users.
— Mykhailo Fedorov (@FedorovMykhailo) February 27, 2022
Both Binance and Kraken have refused to do so unless required by law.
A representative of Binance told Reuters that the exchange will not “unilaterally freeze millions of innocent users’ accounts” because “crypto was meant to provide greater financial freedom for people across the globe.” Binance will comply with the blocking of the accounts of those Russian users to which the sanctions have been applied.
Yesterday, Binance announced a $10 million grant to Ukraine.
Separately, Kraken CEO Jesse Powell responded to Fedorov’s tweet, writing that Kraken “cannot freeze the accounts of our Russian clients without a legal requirement to do so.” He added his “guess that the vast majority of crypto holders on @krakenfx are anti-war” and emphasized his view of the importance of individual needs and rights throughout the thread.
2/6 That requirement could come from your own government, as we have seen in Canada, in response to protests, bank runs and attempts to flee the country.
It could come from foreign states, like the US, as a weapon to turn the Russian populace against its government’s policies.
— Jesse Powell (@jespow) February 28, 2022
Powell also reiterated the crypto use case in Canada “for those who oppose the regime,” referring to Prime Minister Trudeau’s crackdown on trucker-led protests that culminated in his invocation of the Emergencies Act, which allows the government to freeze citizens’ bank accounts without a court order. In response to this, Powell begged users to remove their cryptocurrencies from centralized exchanges.
However, Ukraine’s application of pressure on crypto exchanges to comply is not over yet. The country’s authorities are said to be pursuing legal requirements and official sanctions. The head of the expert group on virtual assets at Ukraine’s Ministry of Digital Transformation (of which Fedorov is the Minister) confirmed today that efforts will be made to force exchanges to participate.
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