South Korean Crypto Exchanges Lead the Way to Target Russian Users

Key Insights:

• South Korea’s largest crypto exchanges target Russian users.
• Singapore and Switzerland have also imposed crypto sanctions on Russia.
• With Japan considering to follow suit, pressure will build on other exchanges to impose similar restrictions.

Last week, the Ukrainian government called on exchanges to impose a blanket ban on Russian crypto accounts. The request followed news of Deputy Prime Minister Mykhailo Fedorov offering bounties for information relating to crypto wallets linked to Russian and Belarusian politicians and their surroundings.

After a slow response to the Ukrainian government’s request, South Korean crypto exchanges have stepped forward.

South Korean Exchanges Move Against Russian IP Addresses

Late last week, South Korean exchanges joined a list of platforms targeting Russian account holders. According to the media, some of South Korea’s largest crypto exchanges barred Russian IP addresses.

Exchanges targeting Russian IP addresses included Gopax, Upbit, Bithumb, Coinone, and Korbit.

Several individual exchanges took additional steps to target Russian users. Additional steps include the following:

• Restrictions on Russian addresses.
• Barring subscriptions from customers in high-risk money laundering countries, based on South Korea’s Financial Action Task Force principles.
• No cashing out of crypto holdings for Russian account holders.

South Korea’s crypto regulations are considered to be among the most stringent.

More Crypto Exchanges Ban Russian Users

The South Korean exchanges are not alone in barring Russian IP addresses. Singapore and Switzerland have followed suit with crypto sanctions, with Japan reportedly considering a similar move.

Over the weekend, Singapore announced sanctions against Russia, with the Republic restricting crypto transactions deemed to evade sanctions.

Singapore’s move follows Switzerland announcing plans to freeze Russian-owned crypto assets. The Swiss freeze of crypto assets is a step beyond EU sanctions. A senior Swiss official reportedly said that the “freezing of crypto assets was necessary because Switzerland wants to protect the integrity of its blockchain industry.”

Pressure on Binance, Coinbase, FTX, and Kraken will likely mount as more governments and exchanges isolate Russia from the crypto market. Late last week, Binance CEO CZ was back in the news, saying that cryptos won’t help Russia circumvent sanctions. Binance CEO CZ reportedly stated that crypto use is “too traceable” and “crypto is too small for Russia.”

It remains to be seen whether the EU, the UK, and the US take a similar view. Last week, news hit the wires of the White House holding talks with Binance and FTX “to cut Russia’s access to crypto.”