In the latest of such scenarios, the ongoing global crisis involving Russia has led to new discussions about the need to impose crypto regulation. After Russia invaded Ukraine this week, several nations, including the European Union, have imposed severe economic sanctions on Russia. However, these sanctions might not have the far-reaching effects on the country as expected because the Russian government could use crypto assets to evade these sanctions.
ECB President urges lawmakers to approve a regulatory framework on crypto.
This possibility of Russia using cryptocurrencies to evade economic sanctions led the President of the European Central Bank (ECB), Christine Lagarde, to urge lawmakers to approve a regulatory framework on crypto.
Lagarde made this call while responding to a question from a reporter on Russia potentially using crypto to evade some of these measures at an informal meeting of economics and finance ministers on Friday. She stated the fact that the ECB would implement any sanction imposed on Russia by the European lawmakers to the latter.
Countries have in the past used crypto to evade sanctions.
There have been countries that have taken advantage of cryptocurrencies to circumvent economic sanctions. Iran and North Korea are among the countries that have a record of using cryptocurrencies for nefarious activities. As reported earlier, a UN report revealed that North Korea used cryptocurrencies to fund its nuclear program. Venezuela was also reported to use cryptocurrencies to evade US sanctions in the last few years.
ECB President Christine Lagarde said, “whenever there is a ban or prohibition or a mechanism in place to boycott or prohibit, there are always criminal ways that will try to circumvent the prohibition or the ban.”