ECB president seeks crypto regulation approval as Russia could evade sanctions

The European Central Bank (ECB) is seeking approval from lawmakers for a crypto-related regulatory framework, signaling the potential prevention of Russia from getting around economic sanctions.

While talking to reporters during a casual meeting of economics and finance ministers on Friday, ECB president Christine Lagarde said that the central bank is aiming to implement the sanctions on Russia imposed by European lawmakers “decisively and rigorously.” The decision came after Russia performed a special military operation on Ukraine.

Crypto regulation is the solution for Russia’s potential evasion

When asked about Russia’s potential evasion of these measures using crypto, the ECB president requested quick action on an existing proposal for a regulatory framework on cryptocurrencies.

Notably, the Markets in Crypto Assets or MiCA, advocated establishing a regulatory framework for the digital assets market that fosters innovation and capitalizes on the promise of crypto-assets while maintaining financial stability and protecting investors.

The plan, which was first presented to the European Commission (EC) in September 2020 and accepted by the European Council in November 2021, was set for a vote by the European Parliament this Monday.

Reporter Stefan Berge, however, stated on Friday that the decision had been postponed due to worries that it might be misinterpreted as a prohibition on proof-of-work crypto mining. There is no date set for EU officials to vote on the plan at the date of publishing.

Lagarde said that there is always an illicit solution to circumvent the prohibition or the ban whenever there is such a situation. He added:

“It’s so critically important that MiCA is pushed through as quickly as possible so we have a regulatory framework within which crypto assets can actually be caught.”

Heavy sanctions

President Joe Biden of the United States announced a number of sanctions intended at imposing “devastating costs” on Russia as a result of the country’s war on Ukraine on Thursday. The US and its allies will impose sanctions on five large Russian banks, as well as many wealthy Russians who have “enriched themselves at the expense of the Russian state,” according to Biden.

On the other hand, citizens in Russia are feared of getting their funds seized if the sanctions go too far.