Updated · May 20, 2022
Japan Asks Crypto Exchanges to Comply With Sanctions on Russia
Updated · Mar 14, 2022
Defaulting comes with heavy punishments of up to 1 million yen ($8,000) and jail time for executives.
Blocking the Crypto Bypass
Financial regulators in Japan have instructed domestic crypto exchanges to abide by rules surrounding the country’s sanctions on Russia.
The orders come as Japan takes steps to ensure Russia does not find cryptocurrency an easy avenue to bypass international sanctions.
It builds on the asset freezing of top Russian and Belarusian officials and oligarchs following the former’s continuing military action in Ukraine. Japan has also banned exports of oil refinery equipment to Russia as well as general-purpose items for the Belarusian military.
Both the Ministry of Finance and the Financial Services Agency have called on 30 crypto exchanges not to transfer digital assets to entities named in the sanctions. The instructions asked that they confirm the addresses of all transfer beneficiaries and flag those of sanctioned individuals and businesses.
Russia’s invasion of Ukraine has drawn widespread condemnation and sanctions. Ranking high among these is the exclusion of Russian banks from SWIFT – an international payment system. There have been fears that the Russian government and institutions could turn to cryptocurrency in a bid to evade the ban.
The Group of Seven (G7) leaders issued a statement on Friday, saying, “We will ensure that the Russian state and elites, proxies and oligarchs cannot leverage digital assets as a means of evading or offsetting the impact of international sanctions.”
The G7 added that it will “impose costs on illicit Russian actors using digital assets to enhance and transfer their wealth.”
According to the Financial Services Agency, exchanges that flout the sanctions could attract fines of 1 million yen ($8,500). In addition, executives of offending agencies could face up to three years in prison.
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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