Updated · May 20, 2022
Crypto Won’t Help Evade Sanctions, Say Binance and Coinbase
Updated · Mar 07, 2022
The CEOs’ comments respond to concerns that Russia could bypass recent sanctions with the help of cryptocurrency.
Crypto is “Too Small”
Cryptocurrency is not effective in helping Russia evade international sanctions, according to the CEOs of Binance and Coinbase. The chief executives of two of the largest crypto exchanges in the world say the focus should rather be on traditional financial institutions.
Binance CEO, Changpeng Zhao, says that cryptocurrencies are “too small for Russia”.
“If we look at the crypto adoption today, there is probably about 3% of the global population with some kind of crypto exposure (i.e., owning some crypto),” he said in a statement. “Of those, most only have a small percentage of their net worth in crypto. Less than 10% on average. So, there is probably only less than 0.3% of the global net worth in crypto today. This percentage applies equally to Russia.”
Zhao added that cryptocurrency presents an ineffective evasion tool because “it is too traceable”.
Coinbase CEO Brian Armstrong mirrored those sentiments in a series of tweets posted on Friday.
1/ We've been seeing some questions/discussion around whether crypto can be used to avoid sanctions. A few thoughts...— Brian Armstrong - barmstrong.eth (@brian_armstrong) March 4, 2022
“We don’t think there’s a high risk of Russian oligarchs using crypto to avoid sanctions. Because it is an open ledger, trying to sneak lots of money through crypto would be more traceable than using U.S. dollars cash, art, gold, or other assets,” he wrote in a tweet on the thread.
Last week, both exchanges rejected calls for a ban on Russian users of their platforms.
Daniel is an Economics grad who fell in love with tech. His love for books and reading pushed him into picking up the pen - and keyboard. Also a data analyst, he's taking that leap into data science and machine learning. When not writing or studying, chances are that you'll catch him watching football or face-deep in an epic fantasy novel.
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