Crypto community responds to Ukraine’s request on banning crypto for Russia

Following Ukraine’s request to major exchanges to block Russian and Belarus investors, multiple crypto exchange platforms have replied. Despite the crypto community highly criticizing Russia’s actions, Ukraine’s request was also criticized by the community.

On Sunday, Ukraine’s Vice Prime Minister and Minister of Digital Transformation, Mykhailo Fedorov, tweeted the request. This came shortly after the US and its allies imposed sanctions on several Russian banks from using the SWIFT financial messaging system. The majority of Moscow’s offshore assets have also been frozen.

Fedorov’s remarks come amid growing concerns about Russia potentially utilizing cryptocurrency to support international trade despite being barred from most global platforms. Russia is one of the world’s top crypto holders, accounting for around 12% of the total crypto market cap.

No positive response from the crypto community

However, Fedorov’s request met opposition from the crypto community, with many claiming that the move would go against crypto’s decentralized, non-politicized nature.

Despite the attitude, one of the country’s largest cryptocurrency exchanges, Kraken, indicated he would not prohibit Russian users due to Russia’s invasion of Ukraine.

1/6 I understand the rationale for this request but, despite my deep respect for the Ukrainian people, @krakenfx cannot freeze the accounts of our Russian clients without a legal requirement to do so.

Russians should be aware that such a requirement could be imminent. #NYKNYC https://t.co/bMRrJzgF8N

— Jesse Powell (@jespow) February 28, 2022

He also warned Russians could face such a requirement in the coming days.

He also mentioned a recent trucker rally in Canada, when the government blocked protesters’ access to most financial resources. On the other hand, the government was unable to regulate non-custodial wallets, preventing crypto donations to the demonstration.

With top-ranking government officials sharing an official address, Ukraine has received more than $10 million through cryptocurrency donations.

According to the Wall Street Journal, Binance, the world’s largest crypto exchange, said it was taking action against entities sanctioned by the West while minimizing the impact on innocent users.

The #NYKNYC campaign, which stands for “Not your keys, not your coins,” has seen a surge in support for decentralized wallets on social media. Because such wallets are not listed on any exchange, no government can effectively regulate them.