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South Korean Exchanges Clamp Down on Russian Users

  • Some of the largest crypto exchanges in South Korea have barred Russian users from accessing their services.
  • These bans extend beyond sanctioned individuals and blacklists all Russian IP addresses as well. 

IPs Blocked Amid Evasion Concerns

According to a local report, most South Korean major exchanges have blacklisted their Russian customers from using their services. This comes after Ukrainian Vice Prime Minister Mykhailo Fedorov called on all cryptocurrency exchanges to block Russian users from accessing their platforms. And of course, a little after major exchanges – Binance, Kraken, and Coinbase refused the Minister’s advice.

Following Russia’s invasion of Ukraine, the European Union (EU), and its allies imposed severe economic sanctions on the country. Russia has been all but isolated from the international economy, and its resources are beginning to suffer.

However, some fear that the country might turn to decentralized finance to keep its economy buoyed. This means that the Russian government might take to conducting transactions in crypto, as opposed to fiat currencies. The recent collective ban from the South Korean exchanges is an evident move to restrict this development.

While most exchanges have avoided the delicate politics surrounding Fedorov’s request, crypto exchanges in South Korea have responded affirmatively. South Korean exchanges declared their support for Ukraine by restricting Russians from conducting business on their platforms.

The first exchange to take this position was Gopax, who, on Wednesday, banned IP addresses from Russia from conducting transactions on their platform. The exchange also froze several Russian-owned accounts.

Upbit, the largest exchange in South Korea by trading volume, has also taken similar steps. The exchange banned accounts that were at high risk for suspicious activity, such as money laundering. The exchange also stated that it could reject withdrawal requests for accounts with affiliations to Russia. Several other exchanges have followed this move, including the popular Bithumb exchange, Coinone, and Korbit.

Other Exchanges Take Opposite Positions

Despite rising concerns about Russia’s use of cryptocurrency to evade its sanctions, not all exchanges have chosen to take such drastic measures. Binance, one of the largest exchanges in the world, has stated that it cannot violate its users’ financial freedom by placing an embargo on all Russian accounts. It did, however, state that it would freeze the accounts of any individual publicly listed on the sanctions list as it did not support Russia’s aggression.

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US-based exchange, Kraken, also took up a similar position, stating that it would not freeze its users’ accounts without solid legal grounds.

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