On Monday 7 March, Coinbase announces through the company blog post that they have blocked 25,000 accounts belonging to Russian individuals and groups. Through the internal investigation held by Coinbase, proof of illicit activities was found in the cryptocurrency exchange.
Coinbase Chief Legal Officer Paul Grewal said Coinbase runs its proactive investigations on all sanctioned users on the exchange and users outside the exchange network. Also, Coinbase uses blockchain analytics of its own to address potential threats and adds them to the internal blocklist. For example, Coinbase actively identified over 1,200 additional addresses associated with sanctioned individuals. Following the identification, Coinbase adds the addresses to the internal blocklist to prevent them from performing transactions.
The move comes to light as the Biden administration requested the crypto exchange platform to help ensure that Russian citizens and agencies are not exploiting cryptocurrencies to avoid sanctions. Likewise, crypto exchanges such as Binance and Coinbase have agreed to comply with the administration mandates to restrict sanctioned Russian individuals.
Publically, many crypto exchanges are under constant pressure from countries like Ukraine, The United States, and other European Countries to ban all the Russian nationalities from their platforms. But, due to the significant concern for other Russian users, the decision is withheld to ban all the Russian users.
Paul Grewal explains that ‘Sanctions‘ play a key role in securing national security and discouraging illegal tensions. Whenever a new user opens an account, the crypto exchange runs a checklist of sanctioned individuals or entities provided by the United States, United Kingdom, European Union, Canada, Japan, and many other nations. He also stresses that the crypto transactions are transparent, traceable, permanent, and public. Perhaps, therefore illicit crimes, activities, and account holders can be tracked down easily.
Also, read - How crypto is playing a key role in helping Ukraine in the war?
