The topic of cryptocurrency use in Russia has been quite popular lately due to the abundance of fresh sanctions. After all, digital assets are decentralised and therefore independent of governments and other bodies.


Against this backdrop, some major platforms have said they are ready to block all people on the relevant sanctions lists. Coinbase, on the other hand, launched its own investigation, which resulted in the blocking of more than 25,000 accounts of Russian citizens. Read more about this in a separate article.

What will happen to cryptocurrencies in Russia?

In a recent interview, the head of FTX noted high activity in trading volumes of digital assets in the CIS. The surge has occurred in the last few weeks, which just happens to coincide with international tensions. Here is Bankman-Fried’s quote on the state of affairs, published by the news publication CryptoPotato.

I think Russia itself is almost a small exception to the rule because of the sanctions that have made it difficult for people to access digital assets as well as everything else. But I think we are definitely seeing an increase in activity in neighbouring regions.

Accordingly, the entrepreneur and billionaire admits that recent decisions by various companies have made it very difficult for Russians to be financially active. And while they still have access to cryptocurrency exchanges, the situation could change at any moment. At the very least, the already mentioned FTX exchange has closed access to the trading platform to residents of Donetsk and Luhansk regions in line with Joe Biden's decree of 21 February 2022.

Sam Bankman-Fried, CEO of FTX

Many trading platforms and exchanges had previously resisted calls to block Russian users, but later acknowledged the need to comply with financial regulators’ requirements. For example, yesterday an official notice appeared on Binance stating that the exchange will stop working with Mastercard and Visa cards issued in Russia.

The decision will be effective as of March 10, Moscow timeframe. Accordingly, users of the largest crypto trading platform will not be able to purchase coins directly with their own bank cards. Accordingly, and although Binance has not closed access for Russians, the number of ways to interact with the platform has decreased anyway. That said, as the exchange's head Changpen Zhao noted, the platform had no influence on this innovation, which means it was clearly initiated by the card issuers in question.

Binance’s announcement to end support for Russian cards

At the same time the global financial system has gone to the complete isolation of Russia, disconnecting some of its banks from the international payment system SWIFT. As a result, the country’s financial institutions have suffered the most as the sanctions have limited their ability to tap foreign exchange reserves. Russian oligarchs and politicians could take advantage of decentralised finance to move their capital out of the sanctions zone, but Bachmann-Fried does not believe such a scenario is realistic. Here’s his rejoinder.

You can easily follow the flow of funds in the decentralised finance niche – and that includes bridges between national currencies and digital assets. These “entry points” into DeFi involve a huge amount of customer identity checks and sanctions evasion activities.


In other words, and although DeFi is a decentralised sphere that anyone can use, entry into crypto is now very difficult due to bank sanctions and bank card issuers' decisions. Therefore, only those who have already been involved in crypto and have acquired coins before will be able to use this niche.


FTX founder Sam Bankman-Fried

Cryptocurrencies remain a hotly debated topic in China as well: the day before, the Guangdong Provincial Development and Reform Commission discovered an illegal crypto-farm secretly operating at an electric car charging station. The clandestine mining centre was located in Guangzhou, where law enforcement authorities are constantly conducting inspections in search of now-banned mining farms in China.

Miners and cryptocurrencies

The crypto-farm reportedly consisted of at least 190 cryptocurrency mining devices, valued at nearly $800,000. Authorities claim that even though the farm consumed a lot of electricity, it remained hidden from law enforcement due to the high power consumption of the charging station itself.


We don't think the cryptocurrency niche can save the government from sanctions, but it can still help ordinary people. This is especially true when you consider that the Central Bank has limited cash withdrawals for Russian citizens to the $10,000 mark. Because of that, currency deposits in large amounts are unlikely to be attractive, and some of that money will obviously go into crypto. At the very least, such actions seem logical given the current situation.