U.S. Treasury Department Sanctions Russia’s Cryptocurrency Mining Operation

As part of strong measures against seven Russian business giants, the White House barred 19 billionaires and their families from entering the country on Thursday. Also, the sanction mentioned seven crypto companies operating in Russia.

U.S. Sanctions Bitriver And Other Crypto Miners For Operating In Russia

Following a press release, the United States Treasury Department said it would take action against entities involved in Russia’s virtual currency mining sector. A Swiss holding company, Bitriver, with three offices in Russia and ten of its subsidiaries, has been designated by the Office of Foreign Assets Control (OFAC) for “operating in Russia’s technology sector.” 

This historic classification by the Treasury represents the first instance the United States has penalized a cryptocurrency mining company. However, the firm is also in the midst of a token preorder for the BTR token, which will begin trading on the 1st of December. As stated by the United States Treasury, BitRiver is “operating several server locations that sell crypto mining machines internationally; these firms are helping Russia to monetize its resources to evade sanctions.”

According to a press statement from the Treasury Department, although Russia has an edge in energy supplies and a cold environment for cryptocurrency mining, mining enterprises depend on imported computer hardware and currency payments, making them subject to sanctions against the country as a whole. To prevent any asset, no matter how complicated it is, from being used by the Putin regime to balance the effect of sanctions, the United States is determined to prevent this from happening.

Sanctions To Cut Off Russia From Global Economy

Ari Redbord, a former federal prosecutor, now the Head of Legal & Government Affairs at TRM Labs, stated that;

“The previous six weeks have seen the United States and its allies impose targeted and more severe sanctions on Russia. These restrictions aim to penalize Russia, influence its conduct, and isolate it from the rest of the world’s financial system. This implies that Russia will be shut off from the means of production. It is believed that the sanctions on BitRiver and affiliated firms are an effort to cut Russia off from the productive forces used to mine cryptos for the purpose of sanction evasion.”

In Redbord’s opinion, “the purpose of attacking a Russia-based cryptocurrency mining company now is similar to targeting a Russia-based gas company or financial institution in the past. These measures are to isolate the country further and stop it from evading sanctions.”

As a result of its aggression toward Ukraine, Russia continues to be subjected to sanctions from various organizations and nations. Also, it is uncertain how the country would sail through the various sanctions, although it is considering legalizing cryptocurrency.

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