The world’s leading cryptocurrency exchange, Binance, announced it is rethinking its strategic ties with Russia and, in a Wall Street Journal statement, indicated that it may completely withdraw from this market. This action follows as the U.S. Department of Justice (DOJ) investigates alleged sanction violations involving Russian banks, adding to Binance’s challenges.
Binance reconsidering strategic ties with Russia
Authorities believe Binance assisted and is assisting Russians to transfer funds out of Russia, despite the company’s claims that it stopped all operations in this country. This crypto exchange also stressed its support of Western-based sanctions against Russia after it invaded Ukraine.
To align its activities with the said sanctions, Binance said it had limited trading activities on Russian platforms and implemented measures to hamstring peer-to-peer transactions involving sanctioned Russian banks. However, the DOJ, questioning this stance, started investigating possible contraventions of U.S. sanctions on Russia.
It found that, initially, Binance did cut down Russian-based operations. But, despite this decrease in services, it still handled significant trading volumes involving the Ruble. Binance admitted to compliance lapses in the past but reiterated its support and commitment to the sanction regulations.
To echo this stance, the exchange further restricted Russian peer-to-peer trading services. Other prominent cryptocurrency exchanges, such as OKX and Bybit also moved to exclude Russian banks from their payment options to align themselves with the penalties imposed by the international community.
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These platforms removed prominent Russian banks such as Tinkoff Bank and Sberbank from peer-to-peer transactions. Tougher regulatory stipulations add to the challenges of cryptocurrency exchanges as they aim to steer a complex digital concept through the waters of compliance to remain operational.
