Users of sanctioned Russian banks are still able to transact on Huobi and KuCoin's platforms.
Considering that many transactions include Tether, a stablecoin that has come under regulatory scrutiny, this might be against US and European sanctions.Adam Zarazinski, CEO of Inca Digital, said:
"Tether is frequently used by Russians to move money out of the country. It is absolutely used by these two exchanges in particular to provide crypto banking services to sanctioned Russian banks.”
Zarazinski announced that the government plans to release the report soon, marking one year since Russia's invasion of Ukraine. The study on 62 crypto exchanges revealed an alarming discovery that some of them failed to conduct KYC checks on Russian users.
Furthermore, the research found that two exchanges enable the acquisition of cryptocurrencies using debit cards from sanctioned Russian banks, such as Sberbank.
Regarding this matter, KuCoin's CEO, Johnny Lyu, communicated through a representative:
"KuCoin does not support the withdrawal and deposit of the cards issued by Russian banks. As an exchange registered in Seychelles, we abide by the laws and regulations of Seychelles. We also respect the laws and regulations of other countries. If there are suspicious transactions that needed to be investigated, we will voluntarily cooperate.”
The claims were refuted by representatives of KuCoin and Binance, two exchanges that were widely featured in the report.
Russians are reportedly able to convert their local currency into cryptocurrencies in a number of methods, including through peer-to-peer markets and over-the-counter desks, on Binance, the largest cryptocurrency exchange in the world. Russians without checks are aware that they can select any of these options for up to $10,000, according to study.
Binance was the first significant exchange to impose EU crypto-related sanctions, according to the company's global director of sanctions. The exchange is also "a comprehensive KYC platform."
Inquiries into Binance have been conducted in numerous nations despite its assertion that it has no central headquarters. In the US, Binance has been examined by the Securities and Exchange Commission, the Commodities Futures Trading Commission, the Department of Justice, and the Internal Revenue Agency.
