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The CEO of US-based crypto exchange is facing a backlash after he said he wouldn’t freeze Russians’ accounts over the invasion of Ukraine — and added that he would sooner block American accounts because of US aggression against other countries.
“If we were going to voluntarily freeze financial accounts of residents of countries unjustly attacking and provoking violence around the world, step 1 would be to freeze all US accounts,” Kraken CEO Jesse Powell wrote on Twitter.
“As a practical matter, that’s not really a viable business option for us.”
Powell was responding to calls from senior Ukrainian officials to block Russians’ access to crypto exchanges.
He said he could not impose such a ban “without a legal requirement to do so” and that “Russians should be aware that such a requirement could be imminent.”
Powell’s tweets prompted protests from Twitter users who vowed to disconnect their accounts.
“We Love Kraken but we are taking our assets off your exchange due to this reason!” tweeted one Twitter user.
Another Twitter user commented on Kraken: “Clearly they support the Russian government and the oligarchs who use crypto to launder money and other illegal practices.”
“Congratulations, Kraken will surely lose thousands of customers,” another commenter said.
But others agreed with Powell’s statement that most crypto holders are anti-war.
One Twitter user wrote: “Being a Russian citizen and having a kraken account is not correlated with supporting Putin. I would actually guess that hackers fighting the cyberwar against him are more correlated to that.”
Powell tweeted that he “would guess that the vast majority of crypto holders on Kraken are anti-war” and that bitcoin was “the embodiment of libertarian values, which strongly favor individualism and human rights.”
Get the latest updates in the Russia-Ukraine conflict with The Post’s live coverage.
He cited the recent trucker protest in Canada which relied on crypto donations after the government froze bank accounts linked to those who participated.
Binance CEO Changpeng Zhao joined Powell in resisting calls to block Russians from accessing their digital assets in light of their government’s invasion of Ukraine.
Zhao told Bloomberg that while Binance would follow sanctions laws “very strictly,” it would be “unethical” to expand the list of those banned from his platform.
“Whoever is on the sanctions list, they won’t be able to use our platform, for whoever is not, they can,” he said.
Zhao said Binance conducts full user verification checks to make sure that those on the sanctions list cannot use the platform.
“It’s not our decision to make to freeze user accounts,” he told Bloomberg.
“Facebook hasn’t banned Russian users. Google has not blocked off Russia. The US hasn’t done that.”
He added: “Also, on an ethical point of view, many Russians don’t support the war, so we should separate the politicians from the normal people.”
The US and the European Union imposed sanctions on Russian financial institutions last week, barring several banks from the SWIFT system.
The targeting of Russia’s financial sector could prompt many in the country to park their assets in cryptocurrency, which is largely unregulated.
Earlier this week, the price of bitcoin surged nearly 17%, fueled by greater demand from asset-holders in both Russia and Ukraine.
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