Regulators in Ukraine and Russia are asking banks to block certain types of crypto transfers

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Banks on both sides of the Russian-Ukrainian war are taking steps to restrict the flow of crypto funds overseas, with central banks keen to prevent individuals from carrying out cross-border crypto-related transactions through banks.

Forklog Ukraine Service reported this Private bankone of Ukraine’s largest commercial banks, had “temporarily prohibited its clients from transferring” fiat hryvnia holdings to crypto exchanges, saying the measure was “related” to a central decision National Bank of Ukraine.

The bloc will remain in place as long as Ukraine remains under martial law. PrivatBank was quoted as explaining:

“Banks are prohibited from making cross-border transfers of currency value from Ukraine on behalf of their clients. Transferring currency funds for use on crypto exchanges is not an exception [to this rule.]”

the WhiteBIT and kunas crypto exchanges, however, insisted that most crypto-fiat trading services would not be discontinued, with the latter telling the same news outlet:

“[Restrictions] on cross-border transfers are understandable. But that has nothing to do with our market. Users can deposit and withdraw hryvnia in Kuna. Everything will work normally. »

Corn Binance claimed that PrivatBank “did not inform” him about the “blocking of hryvnia entry” to the exchange. However, the exchange noted that some users have reported “having encountered issues with such transactions.”

Meanwhile, in Russia, the central bank reportedly included crypto on a list of assets it wants banks to block citizens and organizations from sending to countries that are now on “hostile terms” with Russia.

Vedomosti reported that he had obtained a letter on this subject from the Vice President of the Central Bank Yuri Isaev dated March 16. The outlet claimed that the authenticity of the letter had been confirmed by three sources familiar with the matter.

In the letter, Isaev allegedly explained that the banks had been asked “to monitor the financial transactions of natural and legal persons”, paying particular attention to “attempts to withdraw assets by organizations residing in countries hostile to Russia. “.

This list of “unfriendly” nations includes 48 states, including the US, UK and all of the nations that make up the EU.

The Central Bank reportedly told Russian credit institutions to “pay increased attention to any unusual behavior by customers”. He reportedly told banks to “report any abnormal activity in transactions”, as well as “changes in the nature of spending, including investments”.

Attempts to withdraw funds abroad and transactions involving “digital currency” should be placed under special observation, the central bank leader reportedly wrote.

The banks were reportedly told that “all attempts to circumvent the restrictions” imposed by the Central Bank “must be stopped”. He called for the “blocking of suspicious payments if necessary”.

Isaev reportedly wrote that banks should be wary of “sudden increases in [transaction] volumes that are not characteristic of private consumption. He warned that such transactions could represent the “purchase of goods” which may be intended for “later resale”.

Banks reportedly ordered to report flagged transactions to AML agency Rosfinmonitoring.

Russians and Russian companies have been told that they can only buy securities and real estate from companies and individuals on the “unfriendly” list if they first get special permission from the authorities.


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