TL; DR Breakdown:
- The US Treasury slapped sanctions on Russian-linked crypto miner, BitRiver
- Russia to lose its crypto mining edge due to sanctions
- Sanctions target equipment imports and fiat payments
It seems that Russia is facing sanctions on every possible front. This is after the US Treasury moved to add Russian-linked crypto miners to its sanctions list. Russia made itself a target of international sanctions because of its ongoing invasion of Ukraine. Now, a crypto miner known as BitRiver joins a long list of sanctioned entities targeted by the US government.
Although BitRiver is originally from Russia, it is currently headquartered in Switzerland and has 3 offices in Russia. The sanctions imposed on the mining giant will also affect 10 of its subsidiaries. Notably, this is the first time the US Treasury has targeted a crypto-oriented foreign company with sanctions.
Equipment and payments targeted
While the Russian crypto industry has been thriving of late, it largely depends on imported equipment and foreign fiat payments to stay afloat. These are the choke-points that the US Treasury seeks to focus on in the sanctions announced on 20th April 2022.
It’s worth noting that BitRiver isn’t the only Russian-linked entity to face the recent onslaught of sanctions from the US and other countries around the world. The US has made a long list containing 80 other entities that are now subject to various forms of sanctions. While most of them aren’t in the blockchain or crypto business, they’re certainly involved in banking and finance.
Russian advantage to be stalled
Granted, these recent sanctions are by no means good news to Russia. The move by the US to sanction Russian crypto miners practically unravels the prior advantage these miners had over the rest of the world. Russia boasts plenty of energy resources that are more than enough for profitable crypto mining. It also boasts a cold climate that makes it easier for mining equipment to function optimally. Now, with the importation of mining equipment and fiat payments sanctioned, these advantages won’t be much to go on for Russian miners.
These moves by the US Treasury come soon after the Russian government announced that it was considering plans to adopt cryptocurrencies for international business dealings. The US and its allies view this as an attempt by Russia to evade international sanctions.