Ukraine crisis: Calls for Bitcoin ban emerge following SWIFT sanctions on Russia

Key Takeaways

• Banning crypto will only make it a bigger threat, says user.
• Ukraine vice PM asks crypto exchanges to ban Russian users.
• Crypto community has donated over $13 million worth of cryptocurrency to Ukraine.

LAGOS (CoinChapter.com) — Demand for the ban of Bitcoin and other cryptocurrencies has emerged following the decision of the United States, European Union, United Kingdom, and other western nations to disconnect some top Russian banks from SWIFT.

SWIFT is a cooperative organization that enables thousands of banks globally to easily carry out large-scale financial transactions and payments. The western powers’ decision to sanction Russia arose due to the country’s invasion and aggressive action towards Ukraine.

Following the sanction, several individuals have begun calling for Bitcoin and other cryptocurrencies banned, noting that it could help Russia mitigate the impact of the sanctions.

The U.S. dollar being the currency of global trade and the SWIFT system that enables it is the financial markets equivalent of the U.S. Navy keeping the world’s waterways free. It’s why the U.S. should ban #bitcoin and any other decentralized currency that weakens this even 1%.

— Brad Loncar (@bradloncar) February 26, 2022

Brad Loncar, in a tweet, urged the U.S. to ban Bitcoin to ensure Russia feels the full impact of the sanctions. Similarly, Charles Gasparino, via his official Twitter handle, noted that banning Bitcoin will weaken the Russian economy. Likewise, others have also urged nations to ban Bitcoin, ensuring that Russia’s economy is weakened and its war effort stifled.

However, it is important to note that Bitcoin cannot be banned. The decentralized nature of cryptocurrency makes it impossible for any government to ban Bitcoin fully.

How on earth would the US ban it? It’s totally decentralized, and it’s not something realistically enforceable… They could try and ban the off-ramps and on-ramps. But the thing will probably just gain more value and become a bigger threat. Game theory.

— Noah Kaufman, MD (@noahkaufmanmd) February 27, 2022

Noah Kaufman disagreed with Loncar’s statement saying that any attempt to ban Bitcoin will increase its prominence. He explained that Bitcoin would gain more value and become a bigger threat if banned by western nations.

Another Twitter user argued that calling for the ban on digital assets was a misplaced priority and would not benefit the countries.

He said, “That argument is like saying the British should have banned aircraft in 1900 because it threatened the Navy’s superiority. I don’t think that would have ended well for them and it won’t end well for a superpower banning BTC.”

Ukraine Ask Crypto Exchange To Block Russian Users

Meanwhile, Ukrainian Vice Prime Minister, Mykhailo Fedorov, has called on crypto exchanges to block addresses of Russian users. In addition, Fedorov called on crypto exchanges to ban top government officials and ordinary users.

I'm asking all major crypto exchanges to block addresses of Russian users.

It's crucial to freeze not only the addresses linked to Russian and Belarusian politicians, but also to sabotage ordinary users.

— Mykhailo Fedorov (@FedorovMykhailo) February 27, 2022

Fedorov has been making similar demands to other top tech companies to aid Ukraine’s fight against the Russian invasion. For example, the Ukrainian vice PM previously asked Apple CEO Tim Cook to stop the sale of all its products and services to Russia.

I’ve contacted @tim_cook, Apple's CEO, to block the Apple Store for citizens of the Russian Federation, and to support the package of US government sanctions! If you agree to have the president-killer, then you will have to be satisfied with the only available site Russia 24. pic.twitter.com/b5dm78g2vS

— Mykhailo Fedorov (@FedorovMykhailo) February 25, 2022

While Apple has not yet responded to Fedorov’s request, Jesse Powell Kraken, CEO, has stated that the exchange will not freeze its Russian client’s accounts.

Binance spokesperson also noted that the exchange would not freeze millions of users’ accounts.

However, DMarket, a non-fungible token (NFTs) trading platform, has severed ties with Russia and Belarus. The platform also announced that it had frozen the accounts of users in Russia and Belarus.

How Bitcoin Is Helping Ukraine Fighting Chance

Despite calls for the ban on Bitcoin and other digital assets, the crypto community has rallied around Ukraine. According to reports, over $13 million worth of cryptocurrency has been raised and sent to Ukraine to aid its fight against Russia.

Stand with the people of Ukraine. Now accepting cryptocurrency donations. Bitcoin, Ethereum and USDT.

BTC – 357a3So9CbsNfBBgFYACGvxxS6tMaDoa1P

ETH and USDT (ERC-20) – 0x165CD37b4C644C2921454429E7F9358d18A45e14

— Ukraine / Україна (@Ukraine) February 26, 2022

Ukraine, via its official Twitter handle, announced that it now accepts cryptocurrency and further appealed for donations. In addition, Ethereum co-founder Vitalik Buterin has condemned Vladimir Putin’s decision to invade Ukraine.

“This is a crime against the Ukrainian and Russian people. I want to wish everyone security, although I know that there will be no security. Glory to Ukraine,” he said.

Binance has also donated $10 million to intergovernmental and non-governmental organizations in Ukraine. The fund is expected to provide emergency relief and medical supplies to refugees and children.

we just gave $25 to each Ukrainian on FTX

do what you gotta do

— SBF (@SBF_FTX) February 24, 2022

FTX CEO Sam Bankman-Fried also disclosed that the exchange had gifted every Ukrainian on its platform $25. In addition, a report from blockchain analysis firm Elliptic also disclosed that over $400,000 worth of BTC has been given to the non-governmental organization, Come Back Alive.