Russia Prepares to Block Overseas Crypto Exchanges, Another YouTube-Style Ban Looming?

▲ Russia, Bitcoin (BTC) / AI-generated image

The Russian government appears poised to launch a sweeping crackdown on access to major overseas cryptocurrency exchanges starting this summer. The move is interpreted as an effort to bring domestic crypto trading into the institutional framework.

According to cryptocurrency media outlet Bitcoinist on Feb. 20 (local time), Russian authorities are preparing to block foreign exchanges and reorganize the market around domestic platforms in line with a new cryptocurrency regulatory framework set to take effect on July 1. Local industry experts analyzed that “this measure will likely proceed in a manner similar to the blocking of Telegram or YouTube,” reflecting the government’s determination to formalize the cryptocurrency market within Russia.

Nikita Zuborev, chief analyst at crypto exchange aggregator Bestchange.ru, stated that there is nearly a 100% chance that Russia’s communications regulator Roskomnadzor will begin mass blocking websites of overseas exchanges not registered in Russia as early as this summer. Zuborev predicted that “authorities will use methods such as deleting DNS records within the Russian internet segment and will continue strong crackdowns on circumvention tools.”

Dmitry Machikhin, founder and lawyer at law firm BitOK, assessed that Russia is likely to follow the Belarus model. Belarus allows only specially approved companies to conduct cryptocurrency transactions and strictly prohibits individuals from using overseas platforms. Machikhin added that if foreign exchanges fail to comply with instructions from Russian regulators, authorities may hold them accountable through trials in absentia and impose comprehensive access bans.

The European Union is also considering stronger measures to prevent Russia from using cryptocurrencies to evade sanctions. The European Commission is pushing for a ban on all cryptocurrency transactions linked to Russia, adding 20 Russian banks to its sanctions list and establishing a legal basis to block transactions related to the digital ruble. This development, coupled with Russia’s push to build a domestically centered crypto ecosystem, could further isolate Russian investors.

Russia’s actions are expected to impact overall liquidity in the virtual asset market, including Bitcoin (BTC). In the case of global exchange Binance, more than one million Russian customers are reportedly still using the platform even after it announced its withdrawal from the Russian market. However, if government access restrictions become a reality, their trading activities may be forced underground or come to a halt. As the regulatory framework is finalized in July, the Russian cryptocurrency market is likely to face a whirlwind of significant changes.

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