March 26, 2024 at 05:09AM
The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) imposed sanctions on three cryptocurrency exchanges for aiding in circumventing economic restrictions on Russia following its invasion of Ukraine. The designations cover thirteen entities and two individuals operating in the Russian financial services and technology sectors, freezing their US properties and interests. These sanctions aim to disrupt companies enabling sanctioned Russian financial institutions to access the global financial system.
From the meeting notes on March 26, 2024, it is clear that the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) has sanctioned three cryptocurrency exchanges for offering services used to evade economic restrictions imposed on Russia post its invasion of Ukraine in early 2022. The sanctioned entities include Bitpapa IC FZC LLC, Crypto Explorer DMCC (AWEX), and Obshchestvo S Ogranichennoy Otvetstvennostyu Tsentr Obrabotki Elektronnykh Platezhey (TOEP), among others.
The designations cover thirteen entities and two individuals operating in the Russian financial services and technology sectors. These entities and individuals are alleged to have facilitated transactions or offered services that helped OFAC-designated entities evade sanctions. The aim of this action by the Treasury is to target companies servicing Russia’s core financial infrastructure and curtail Russia’s use of the international financial system to further its war against Ukraine.
The sanctioned entities, such as Bitpapa and Crypto Explorer, have been accused of facilitating transactions worth millions of dollars with sanctioned Russian entities and offering currency conversion services between virtual currencies, rubles, and UAE dirhams. Furthermore, these entities have been found to enable digital payments in rubles and virtual currencies to sanctioned entities such as Sberbank, Alfa-Bank, and Hydra Market.
Consequently, all properties and interests in the U.S. connected to designated individuals and entities will be frozen, and entities at least 50% owned directly or indirectly by one or more blocked persons will also be subject to the blockade. The Under Secretary of the Treasury for Terrorism and Financial Intelligence, Brian E. Nelson, highlighted that Russia is increasingly turning to alternative payment mechanisms to circumvent U.S. sanctions and continue to fund its war against Ukraine. In response, the Treasury will continue to expose and disrupt the companies that seek to help sanctioned Russian financial institutions reconnect to the global financial system.
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