Did Binance Help Russia Avoid Economic Sanctions? The US is investigating

US Justice is investigating the cryptocurrency exchange platform. Binance is accused of allowing Russia to evade financial sanctions, imposed after its invasion of Ukraine in February 2022.

Did Binance allow Russians to circumvent US sanctions? The cryptocurrency exchange is under investigation by the US Department of Justice, according to Bloomberg.

In an article from May 5, 2023, the newspaper revealed that Binance could have been used by people with Russian nationality to send money and evade economic sanctions, put in place since the start of the invasion of Ukraine.

Cryptocurrencies Used to Avoid Sanctions

In its article, Bloomberg says the investigation is being led by the Justice Department’s National Security Division. The latter must determine whether Binance or its employees have “go against the sanctions imposed in response to the invasion of Ukraine by Russia”, according to five people interviewed by the newspaper.

In a statement shared with Bloomberg, Binance indicated that it is fully cooperating with all financial sanctions imposed by the United States and internationally. It also recalled that it applies the rules regarding the identity verification of its customers and that its requirements in terms of security are similar to those of traditional banks. “Our rules impose zero tolerance in terms of double registration, anonymity, and sources of money.”

However, this is not the first time that the platform has been worried for similar reasons. Binance is already in discussions with the US Department of Justice in connection with complaints regarding Iran. The platform is accused of having been used in the past by the Iranian regime to evade economic sanctions imposed by the United States, reports Bloomberg.

The sanctions imposed on Russia by the United States and the European Union are numerous, and concern, in particular, the economic sector, that of new technologies, and that of energy. Some Russian and Belarusian banks have been excluded from the SWIFT system, and European authorities are prohibited from carrying out transactions with Russian and Belarusian central banks and with the Russian Regional Development Bank.

As soon as these sanctions were announced, fears were raised that the cryptocurrency industry was allowing Russian authorities to circumvent most bans. Until now, Binance has always claimed to follow international decisions, although the platform returned to Russia in April 2023, allowing local users to access their wallets. It remains to be seen whether the measures she has taken will be deemed sufficient by the US Department of Justice.