Ukraine has committed to preventing Russia’s use of digital assets for cross-border payments and sanctions, according to Vladyslav Vlasiuk, adviser to the president of Ukraine and commissioner for sanctions policy.
On December 26, the Ukrainian government announced “sanctions and other solutions” to prevent Russia from using digital assets for international payments, such as reported of local publication Ukrainska Pravda.
The announcement came –accidentally-a day after Russian Finance Minister Anton Siluanov said in an interview with the Russia 24 TV channel that Russian companies have started using BTC and other digital assets in international payments following legal changes that facilitated this use. Sanction avoidance.
“As part of the experimental regime, it is possible to use bitcoins that we had mined here in Russia (in foreign trade transactions),” said Siluanov. after to a December 26 Reuters report. “Such transactions have already happened. We believe that they should be further expanded and developed. I am confident that this will happen next year.”
Siluanov added that international payments and digital assets represent the future.
Russia and sanctions
After its illegal invasion of Ukraine in February 2022, Russia was hit with an unprecedented set of sanctions by the international community, which put the country under heavy economic pressure.
The sanctions ranged from freezing the assets of Russian state-linked individuals to the exclusion of major Russian banks – including Bank Otkritie, Novikombank, Promsvyazbank, Rossiya Bank, Sovcombank, VEB, and VTB – from the international financial messaging system, Society for Worldwide Interbank Financial Telecommunication (SWIFT).
Gross domestic product (GDP) of Russia 2022 and 2023 fell after the invasion. The country’s Ministry of Economy recently announced a positive forecast for 2024, which depends heavily on large-scale government spending on weapons production, lead some to forecast an impending economic disaster.
It is perhaps no surprise, then, that Russia has increasingly looked to alternative trade and financial routes – particularly to help it overcome its exile from the SWIFT payment system– and the pseudo-anonymity and supposed Decentralization of digital assets afford naturally appealed to the serious state.
The sanctioned Moscow-based digital asset exchange Garantex alone reports relieved Transfers of more than $20 billion in Tether-the ubiquitous US dollar-pegged stablecoin – since early 2022.
Ukraine’s answer
For its part, Ukraine was one of the first countries to raise concerns about such abuse of the digital asset space for sanction avoidance. Following the announcement of Russia’s latest legislative efforts to facilitate the payment of digital assets, Ukraine quickly countered with its own plans.
“Are we surprised at all? No, we were, without exaggeration, the first to draw the attention of our partners to such plans of the enemy back in the summer,” said Commissioner for Sanctions Policy Vlasiuk.
He added that “appropriate sanctions and other solutions to block the possibility of using unwanted cryptocurrency payments are already prepared.”
Vlasiuk did not elaborate on what form the proposed “sanctions and solutions” would take, but it is likely that facilitators of payments, such as wallet providers and digital asset exchanges, will be a priority.
See: Find ways to use CBDC outside of digital currencies
title = “YouTube Video Player” frameborder = “0” allow = “Accelerometer; Autoplay; Clipboard-Write; Encrypted Media; Gyroscope; Picture-in-Picture; Web-Share” referrerpolicy = “strict-origin-when-cross- origin ” allowfullscreen>
