The CEO of the largest cryptocurrency exchange Binance, Changpeng Zhao, spoke about the work of the sanctions team. So far, only one Russian has been blocked from the site’s clients.
Changpeng Zhao began his article by saying how hurt he is by what is happening in Ukraine. He stressed that the Binance team is doing everything possible to help the people of the country, for example, the exchange has donated $10 million to humanitarian charities.
The CEO of Binance emphasized that the company is subject to the requirements of the sanctions, just like banks. However, the exchange is not going to block all users from Russia or freeze their assets.
“We don’t have that kind of power. The sanctions affect the top of the Russian government, law enforcement agencies and even the military. We do not think that companies or platforms can unilaterally decide to freeze users’ assets. There are a lot of Russian citizens in London or New York, and on what grounds would a British bank CEO freeze their assets? We should follow the sanctions lists and not come up with our own sanctions,” Zhao wrote.
He also emphasized that it is not worth “hyping” the use of cryptocurrencies by Russians to circumvent sanctions. According to Zhao, Russians represent about 3% of the total number of people using cryptocurrencies, and the share of cryptocurrencies in their wallets is even smaller. But the media pays a lot of attention to it.
“Even if we completely block this share. Will this change anything? Instead of cryptocurrencies, you need to focus on banks, oil, gas and other measures,” says Binance CEO.
Zhao also emphasized that the Russian authorities are unlikely to use cryptocurrencies to circumvent sanctions – they are too easy to trace, because all transactions on the blockchain are available to everyone. And anonymous cryptocurrencies have a small capitalization compared to the funds at the disposal of Russia.
It is also important that there are many small cryptocurrency sites, and even if large exchanges block users from Russia, they will simply start using such sites.
Zhao said that the compliance team at Binance has 500 people, and about half of them work directly on the sanctions lists. And, despite the huge amount of work done, the exchange blocked only one person.
The fact is that Binance tools do not allow “politically significant people” to register, and the vast majority of Russians on the sanctions lists belong to such persons. Therefore, they simply do not have accounts on the exchange. The platform tools also allow you to refuse registration to family members of such people, their lawyers, and so on. At the same time, over the past three years, the tools have identified approximately 20,000 risky accounts.
“I will emphasize again. We comply with all requirements for blocking people from the sanctions lists. And cryptocurrencies are not suitable for circumventing sanctions. And I will ask again – should Binance block all Russians unilaterally? I’ll ask it differently – should a coffee shop in Paris refuse service to all Russians or take their wallets away? The answer is no. We will not freeze the accounts of millions of uninvolved users,” Zhao concluded.
He noted that if new sanctions are adopted, the exchange will follow them. The Binance team is constantly in contact with governments, but the platform will not come up with sanctions on its own.
At the end of February, the CEO of the Kraken exchange, Jesse Powell, said that he did not intend to block the accounts of Russian users. According to him, if you block users from “aggressor countries”, then the first on the list will be the Americans.
Source: Bits
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