The US took substantial and unprecedented action in response to Russia’s continued invasion of Ukraine. The US imposed severe economic costs on Russia economy and financial system. Those sanctions will have immediate and long-term consequences.
The US Treasury’s Office of Foreign Assets Control imposed broad economic measures a few days ago, in collaboration with their partners. The measures are targeting the core infrastructure of Russia’s financial system. That includes all of Russia’s largest financial institutions and the ability of state-owned and private entities to raise capital.
The US wants to isolate Russia from the global financial system. The moves target approximately 80% of all banking assets in Russia. It is expected that those economic measures are going to have a significant impact on the Russian economy.
According to reports, The Treasury Department and the White House have issued a warning to US-based businesses and citizens not to support crypto transactions addressed to specified Russian banks. The US will completely freeze Russia’s assets within the country.
Cutting Russia off from SWIFT
Even tho those sanctions were announced a few days ago, the US Treasury scheduled them to go into effect on March 1st.
Secretary of US Treasury – Janet Yellen stated that the moves were taken to substantially limit Russia’s ability to use assets to finance its disruptive operations. They are targeting the finances Putin and his inner circle rely on to support their invasion of Ukraine.
A few other countries, aside from the US, have also stated that several of Russia’s top banks will be cut off from SWIFT. SWIFT represents the interbank messaging network that underpins much of the global financial system. Every day, SWIFT transports billions of dollars between over 11,000 banks and other financial institutions all around the world.
When Russia seized Ukraine’s Crimea and backed rebel forces in eastern Ukraine in 2014, the Atlantic alliance evaluated the SWIFT option. Russia said at the time that excluding it from SWIFT would be tantamount to declaring war.
The allies scrapped the concept at the time, after being chastised for their feeble response to Russia’s assault in 2014. Since then, Russia has attempted but failed, to build its financial transmission system.
The US Treasury has already banned a certain country because of its nuclear program, through the Belgium SWIFT system. The country that had to be sanctioned back then was Iran. Nonetheless, excluding Russia from SWIFT might harm other economies, particularly that of the United States and its crucial partner Germany.
The US has issued new crypto rules
According to some other reports, US officials are also pushing crypto exchanges throughout the world. This will prevent Russian organizations from dodging sanctions by utilizing cryptocurrency.
Officials from the Treasury Department have already requested that Binance, FTX, and Coinbase prohibit sanctioned individuals. However, these companies are not based in the United States. Despite pleas from Ukrainian Vice Prime Minister Mykhailo Fedorov, Binance and many other exchanges have openly said that they will not prohibit all Russian users nor their IP addresses.
Your capital is at risk.
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