Huw Jones

LONDON (Reuters), -Global financial regulators closely examine the use of cryptocurrencyassets in the conflict with Ukraine. They are concerned that they might be used by Russia to evade Western sanctions.

Due to warnings from U.S. legislators and European lawmakers, crypto’s $1.8 trillion sector has been put on guard. This is despite the fact that many digital asset companies have not met the financial sanctions placed on Russia by the West after its invasion of Ukraine.

Some cryptocurrency exchanges rejected requests to stop all Russian users. This raises concerns about crypto being used to bypass sanctions.

After posting requests on social media, Ukraine raised over $100 million in cryptocurrency.

“We at the FSB are monitoring the situation, the conflict situation relative to cryptos,” Patrick Armstrong, a member of the Financial Stability Board’s (FSB) secretariat, told a City & Financial conference in London.

Armstrong explained that the FSB, which is composed of central banks and financial regulators from the Group of 20 economies shares the information it receives with its members.

In an attempt to eliminate any potential loopholes in sanctions, the European Union issued guidance on March 9, confirming that cryptoassets are included as part of sanctions for loans and credit to Russia.

John Glen from Britain, the minister for financial services, said at the conference that measures taken by the UK in order to make cryptoassets subject to anti-money laundering, terrorist financing curbs, will be supported law enforcement of cryptoassets.

Glen stated that he believes these actions will support Russia’s attack on Ukraine.

David Raw of Britain’s Financial Conduct Authority stated that 90 percent of cryptocurrency firms applying to approve anti-money laundering controls either withdrew their requests or were refused approval because they couldn’t meet the requirements.

Raw reminded those stuck in the approval queue that all companies involved in crypto-related activity in Britain have until March 31, 2018, to obtain their approvals.

Raw explained, “It won’t be the situation that you suddenly must stop trading.”

Britain is cracking down also on crypto-promotions and Glen indicated that the UK government still considers whether any additional rules for blockchain (which underpins crypto assets) are necessary.

Raw declared, “We’re not done in crypto,”