The United States is imposing more sanctions on Russia for its alleged involvement in the Ukraine invasion. The country is now saying it will penalize all crypto miners who seek to assist Russia in evading the present regulations set forth by the U.S. and its allies.
Russia Is Getting Hit Again
The United States has long been at it with Russia. The country potentially invaded Ukraine back in February despite many attempts from the U.S. and other countries to dissuade it from doing so. Clearly, the sanctions are doing nothing, for as soon as the first round took precedence, there were many arguments permeating the crypto space regarding whether Russia could ultimately use digital assets to avoid the regulations established by the west.
These new sanctions specifically target crypto mining companies stationed in Russia. Per data from Cambridge University, Russia boasts the third-largest bitcoin mining market in the world. Brian Nelson – secretary for terrorism and financial intelligence – commented in an interview:
By operating vast server farms that sell virtual currency mining capacity internationally, these companies help Russia monetize its natural resources. 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.
Some of the companies specifically being hit by these new regulations include Bit River. Founded in 2017, the enterprise operates mining firms using hydroelectric power. It’s a shame that such a company is now being sanctioned given that it’s bringing so many aspects to the table that would arguably make crypto hounds happy.
After all, many individuals have often complained that crypto mining uses heavy amounts of energy and puts the planet in danger. This is a firm that dares to utilize clean energy to get the job done. Now it’s going to be stopped in its tracks? It is stated that the company utilizes more than 200 full-time staff members in its operations and has three separate locations throughout Russia.
The Office of Foreign Assets Control says Bit River and many other firms like it are potentially helping Russia to lessen the economic blows its experiencing from the likes of the U.S. and its allies. In a statement, unnamed Treasury officials claimed:
The United States is committed to ensuring that no asset, no matter how complex, becomes a mechanism for the Putin regime to offset the impact of sanctions.
Why Is Crypto So Important Lately?
Crypto has been a huge topic of discussion in American politics as of late, with the Biden administration recently issuing a crypto executive order telling national agencies to analyze crypto and its risks while also opening the door to a digital version of USD.
In addition, senators such as Elizabeth Warren of Massachusetts have called for crypto exchanges to cut Russia off completely.