All of the world's largest financial institutions have decided to stop doing business with Russia, a decision prompted by autocrat Vladimir Putin's decision to invade Ukraine. Well, all except the cryptocurrency markets, that is. according to a vice reportSome of the world's largest cryptocurrency exchanges, including Coinbase, Binance and Kraken Exchange, have rejected calls to freeze Russian accounts because it would go against the "libertarian values" of cryptocurrencies.
The decision not to cut off Russian access to crypto-related exchanges and assets comes as Ukraine's Deputy Prime Minister Mykhailo Fedorov order directly for the services to prohibit all activity from Russian and Belarusian addresses. This, according to Fedorov, would increase economic pressure on Russia and bring them to the negotiating table.
Crypto exchanges said no. A spokesperson for Binance, the world's largest cryptocurrency exchange, he told CNBC that it would comply with sanctions but nothing more. “Crypto is meant to provide greater financial freedom to people around the world. Unilaterally deciding to ban people from accessing your crypto would go against the very reason crypto exists,” a company spokesperson told the publication.
Other platforms have also adopted this supposed principled defense of cryptocurrencies. KuCoin he told CNBC which is “a neutral platform”. The CEO of the US-based Kraken Exchange. took to twitter say that cryptocurrency is "the embodiment of libertarian values, strongly favoring individualism and human rights," and for that reason, the company would not freeze Russian accounts "without a legal requirement to do so." base of coins told the vice that it would not restrict the Russians because it would interfere with their mission to "increase economic freedom in the world."
This isn't the response of a cryptocurrency exchange, but cryptomaximalist weirdo Mike Alfred, but it's funny and ridiculous, so I'm including it: In response to Fedorov's request to freeze Russian cryptocurrency accounts, Alfred tweeted that he was pulling his support to Ukraine. Frankly, his support probably wasn't worth much to begin with. But the idea that he is now okay with Russia killing innocent civilians because a politician called for restrictions on crypto is really the best distillation of these crypto fools' priorities.
In any case! There is no evidence that cryptocurrency exchanges have succeeded in increasing economic freedom after the war, but the conflict has certainly increased activity on the exchanges themselves. according to a CoinDesk report, trading between the Russian ruble and Bitcoin hit a nine-month high this week. While 1 in 10 Russians reportedly owns cryptocurrencies, the country has restrictions imposed about how much average citizens can have, while wealthy oligarchs have supposedly considered cryptocurrency as a way to circumvent sanctions and protect your wealth.
Also, very quickly: if cryptocurrency exchanges were that concerned about upholding the principles of cryptocurrency, they would simply shut down. Platforms like Binance and Coinbase are centralized exchanges. They are intermediaries that exist to process transactions and make profits from each operation; they often charge fees even to list specific coins. Cryptocurrency and its "libertarian values" were explicitly based on decentralization, where these types of institutions are not supposed to interfere. Vitalik Buterin, the co-founder of the Ethereum cryptocurrency, went so far as to say that centralized exchanges should “burn in hell” for violating the principles of cryptocurrencies.
Cryptocurrency exchanges make it easy for the average person to trade these digital assets, but they inherently operate in opposition to crypto principles. But that doesn't matter to them because the exchanges are charging. The real reason they won't freeze Russian accounts isn't because of assumed values, it's because thanks to the war, more trades than ever are taking place with those accounts. And being the platform where those exchanges happen, these exchanges can profit from it.
