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Sanctions against Russian bitcoin miners by the US government

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Pavan A Follow

INDIA

Apr, 25 2022

Apr, 25 2022

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U.S. sanctions were imposed today on Moscow-based BitRiver by the Treasury Department's Office of Foreign Assets Control.

 

The sanctions are aimed at harming Russian President Vladimir Putin and his allies following the invasion of Ukraine. This is the first time the U.S. has sanctioned a cryptocurrency mining company. A total of ten subsidiaries of BitRiver AG, BitRiver's Swiss holding company, have also been listed.

 

Russia is said to have tried to use crypto to evade sanctions, the International Monetary Fund warned in a report.

 

According to Brian Nelson, the Under Secretary for Terrorism and Financial Intelligence, "Treasury can and will target those who evade, attempt to evade, or aid the evasion of U.S. sanctions against Russia, as they are helping support Putin’s brutal war of choice."

 

A cryptocurrency mining company called Bitriver claims to be the world's largest eco-friendly mining company. Based in Bratsk, Siberia, it boasts a 100-megawatt data center powered by renewable energy and able to handle 75,000 miners.

 

As a result, the firm operated mining farms, which it sold to international clients to ‘monetize Russia's natural resources.

 

A treasury department report says Russia's energy resources and cold climate give it an edge in crypto mining. However, mining companies rely on imported equipment, putting them at risk of sanctions.

 

Furthermore, the Treasury also sanctioned the mining firm and more than 40 other individuals and entities, including the Russian bank Transkapitalbank, led by oligarch Konstantin Malofeev.

 

Adding to the anti-crypto rhetoric, the Treasury Department started declaring cryptocurrency transactions "deceptive or structured transactions" which could be used to evade sanctions.

 

As part of that sentiment, this week the IMF said countries like Russia and Iran could use cryptocurrency to circumvent sanctions.


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Pavan A

CBW - External Analyst

INDIA

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