US OFAC Sanctions Crypto Firms with Russian Ties; SEC Seeks Large Fine from Ripple

By: Isha Das

The US Department of the Treasury's Office of Foreign Assets Control (OFAC) has placed sanctions on 13 entities and two individuals involved in the financial services and technology sectors of Russia. These entities, including several virtual asset service firms, are alleged to enable the circumvention of US sanctions. The affected parties, all reported on March 26, include several Moscow-based fintech firms such as B-Crypto, Masterchain, Laitkhaus, and Atomaiz, who have connections with OFAC-designated Russian banks including Rosbank, VTB Bank, Sberbank, and Sovcombank. Also designated was Moskow tech companies Veb3 Tekhnologii and Veb3 Integrator, along with TOEP, a virtual currency exchange doing business as Netexchange and Netex24. Other designated companies include peer-to-peer virtual currency exchange Bitpapa and Crypto Explorer, a Russia and UAE-based virtual currency exchange.

The new sanctions are intended to lessen Russia's ability to use alternative payment mechanisms and financial technologies to skirt US sanctions. The Treasury's move is in response to Russia's ongoing war against Ukraine and aimed at pressuring Russia to change its behavior.

In related news, the U.S. Securities and Exchange Commission (SEC) has asked a New York judge to impose a nearly $2 billion judgment against Ripple Labs, an American technology company which principally offers a real-time gross settlement system, currency exchange, and remittance network.