The chief executive of Binance has defied calls to freeze the accounts of Russian users amid conflict with Ukraine.
Changpeng ‘CZ’ Zhao told Bloomberg that Binance will follow international laws when it comes to sanctioning certain Russian individuals, but will not issue a blanket ban on users. Ukraine’s vice prime minister called on crypto exchanges to block Russian and Belarusian accounts this weekend following concerns that digital assets allow individuals to avoid sanctions.
“I just think its not our decision to make to freeze user accounts,” CZ said. “we just follow the rules we don’t make them.”
“From an ethical point of view many Russians do not support this war so I think we should separate the politicians to the normal people,” he continued.
CZ denied that Russian individuals, who are subject to sanctions, would be able to open anonymous accounts to trade crypto on Binance. He insisted that the world’s largest crypto exchange is Know Your Customer (KYC) compliant.
“Binance follows sanctions rules very strictly. Whoever is on the sanctions list, they won’t be able to use our platform, for whoever is not, they can,” Zhao told Bloomberg in an interview today.
Crypto exchanges have come under intense scrutiny since Russia’s invasion of Ukraine for their potential as financial conduits for Russians seeking a place to park assets. But other large exchanges like Kraken and Coinbase have also refused to block Russians who aren’t targeted by sanctions.
Regulators and lawmakers in the US and Europe have been strengthening rules around crypto amid the conflict with Ukraine. The Economic Crime bill was reintroduced to parliament this week and included specific provisions which will allow the government to seize crypto assets.
Since the invasion of Ukraine began last week, Russia-Rouble trading has soared. On Monday, $63m worth of Russian Roubles were exchanged for crypto according to Chainalysis leading to concerns that digital assets could undermine the effectiveness of sanctions.