Ukraine Calls on Crypto Exchanges to Freeze Russian Accounts

Key Insights

• Mykhailo Fedorov, the vice prime minister of Ukraine, has called on crypto exchanges to freeze the accounts of both Russian and Belarusian users.
• DMarket acted upon the request by ‘cutting all relationships with Russia and Belarus due to the invasion of Ukraine.
• Close to $19 million in crypto has been donated to the Ukrainian government since the government’s appeal on Friday.

After a slew of sanctions against Russia last week, the Ukraine government has launched a crypto comeback. In the most recent development from the Russia-Ukraine tensions, Mykhailo Fedorov, vice prime minister and minister of digital transformation of Ukraine, has called on crypto exchanges to freeze the accounts of both Russian and Belarusian users.

Call To Action

Fedorov Tweeted saying that, he is ‘asking all major crypto exchanges to block addresses of Russian users.’ Further explaining, he said that it is ‘crucial to freeze not only the addresses linked to Russian and Belarusian politicians but also to sabotage ordinary users.’

I'm asking all major crypto exchanges to block addresses of Russian users.

It's crucial to freeze not only the addresses linked to Russian and Belarusian politicians, but also to sabotage ordinary users.

— Mykhailo Fedorov (@FedorovMykhailo) February 27, 2022

The minister posted his plea via Twitter on February 27, following several days of intense fighting in Ukraine after Russian forces invaded the country last week. In response to this, DMarket, a Ukraine-based digital assets company tweeted to say:

“Ukrainian-born startup DMarket cuts all relationships with Russia and Belarus due to the invasion of Ukraine.”

DMarket acts as an exchange to trade virtual items from any game to any platform, ‘connecting the entertainment industry with the global metaverse.’

The company quickly acted upon Fedorov’s request to freeze accounts belonging to customers in Russia and Belarus. The company confirmed via Twitter that while assets remain in users’ accounts, their access is limited.

Ukrainian-born startup DMarket cuts all relationships with Russia and Belarus due to the invasion of Ukraine.

– The registration on the platform is prohibited for users from Russia and Belarus;

– Accounts of previously registered users from these areas are frozen;

— DMarket (@dmarket) February 27, 2022

In response to the NFT platform’s announcement, Fedorov tweeted that ‘funds from these (frozen) accounts could be donated to the war effort.’

That said, Kraken CEO, Jesse Powell responded by saying that such a move could not be taken ‘without a legal requirement to do so.’ However, he cautioned that Russian users should be aware that such an order ‘could be imminent.’

Ukraine’s Efforts to Sabotage Crypto Use in Russia

The Ukrainian government has already used Twitter to draw millions in crypto donations. On February 26, Fedorov called for support by announcing that the government would accept Ethereum (ETH), Bitcoin (BTC), and Tether (USDT) donations. Meanwhile, more than $19 million in crypto has been donated to the Ukrainian government since the government’s appeal on Friday.

That said, the government has also posted in online hacker forums that it is looking for help in protecting against cyberattacks.

Furthermore, recently, the United States and European Union jointly moved to cut certain Russian banks out of SWIFT, the international payments messaging system, in addition to freezing the overseas assets of Russia’s central bank.