US lawmakers introduce bills that could force crypto exchanges to cut ties with Russian wallets

by Lillian Wagner
US lawmakers introduce bills that could force crypto exchanges to cut ties with Russian wallets

Representative Brad Sherman will be introducing a bill in the House aimed at cracking down on U.S. businesses handling crypto transactions for Russian banks and individuals.

Speaking at a hybrid markup meeting with the House Financial Services Committee on Thursday, Sherman said he will be introducing a companion bill to Senator Elizabeth Warren’s legislation that would give the Biden administration “explicit authority to require that crypto exchanges that are subject to U.S. law stop facilitating transactions with Russian-based crypto wallets.” Warren first announced the legislation on March 8, later saying during a Senate Banking Committee hearing she will be introducing the bill on Thursday.

Neither bill’s text is available through congressional records at the time of publication. However, Warren’s proposed legislation would reportedly give the Treasury Department the authority to stop crypto exchanges under U.S. jurisdiction from processing transactions from any crypto addresses belonging to Russian nationals. In addition, U.S. taxpayers would be required to report any crypto transactions outside the country exceeding $10,000 to the Financial Crimes Enforcement Network, or FinCEN.

“[I] look forward to joining with my colleagues to make sure that one of the tools available to the administration is the ability to tell crypto exchanges if they’re doing business in the United States, they can’t do business with Russia-based crypto wallets until this crisis is over,” said Sherman.

Representative Brad Sherman addressing the House Financial Services Committee on Thursday

Related: Congressional candidate seeking to unseat anti-crypto Brad Sherman is accepting contributions via Lightning

Sherman, who has previously made several anti-crypto statements including calling for a ban on digital assets, cited Ukraine’s Minister of Digital Transformation asking for all exchanges “to block addresses of Russian users” seemingly without restricting the ban to individuals and businesses named in U.S. and EU sanctions. Binance CEO Changpeng Zhao said the firm would comply with sanctions but not block transactions connected to all Russia crypto wallets, while Kraken CEO Jesse Powell said there would have to be a legal requirement for the exchange to freeze Russian accounts.

“We are not going to unilaterally freeze millions of innocent users’ accounts,” a Binance spokesperson told Cointelegraph in February. “Crypto is meant to provide greater financial freedom for people across the globe.”

Michael Chobanian, the founder of Ukraine’s Kuna crypto exchange, said on Thursday the platform had stopped “all support for the Russian ruble.” However, his call to crypto exchanges included blocking “any interaction with sanctioned individuals,” seemingly not all wallets held by Russian nationals based in the country or abroad.