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April 22, 2022 by Vignesh Karunanidhi
The US Treasury Department stated on Wednesday that it had broadened its list of sanctions to include firms and persons who are suspected of assisting Russia in evading the impact of economic sanctions placed on the country.
Treasury sources said the agency is now focusing on Russian commercial bank Transkapitalbank and a network of more than 40 people, including tycoon Konstantin Malofeyev, who they say helped the Kremlin avoid a wave of economic sanctions.
The Biden administration also stated it is tightening down on enterprises that help Russia monetize its exports and other natural resources, such as Bitriver, that operate in the virtual currency mining sector.
US sanctions the first Russian Bitcoin mining company
Since the war on February 24, the United States has implemented multiple rounds of sanctions. Sanctions have been imposed on the country’s top banks and lenders, as well as cryptocurrency exchanges. “Having operated in the Russian Federation economy’s technology sector,” Bitriver was labeled.
Bitriver claims to be the world’s largest provider of environmentally-friendly cryptocurrency mining, having been created in 2017. It boasts a 100-megawatt renewable energy data center in Bratsk, Siberia, with 75,000 miners.
According to the Treasury Department, the company sold mining capacity to overseas clients, allowing Russia to “monetize its natural resources.” It went on to say:
“Russia has a comparative advantage in crypto mining due to energy resources and a cold climate. However, mining companies rely on imported computer equipment and fiat payments, which makes them vulnerable to sanctions.”
Anti-industry lawmakers in the United States have been increasing their rhetoric, believing that the country exploits crypto assets to dodge sanctions.
The Treasury Department defined crypto transactions to be “deceptive or organized transactions or deals” that might be exploited in sanctions evasion just days after the invasion in February.
The International Monetary Fund (IMF) echoed this opinion this week, warning that nations such as Russia and Iran may utilize cryptocurrencies to circumvent sanctions.
However, economists and industry experts have slammed the idea that the country will turn to crypto to dodge sanctions.
