Is it possible to effectively sanction cryptocurrency?

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Worldwide Strategy & Portfolio, Cross Industry (Supply Chain, ESG, Engineering, Customer Experience, Intelligence Automation, ERP) in Manufacturing, 1,001 - 5,000 employees
It's not possible to completely sanction cryptocurrency. We've moved away from policy in which sanctions apply to a wide space like Cuba and now they’re applied to individuals, partial company owners, or individual oligarchy members. That's becoming an increasingly challenging aspect of sanctions and companies haven't figured out how to navigate this yet. It's almost impossible for the corporation to know who they're doing business with and track that individually, so we have to be a lot more sophisticated on all ends.
3 Replies
CEO in Software, 11 - 50 employees

It’s not clear what will happen when cryptocurrency becomes a mainstream method of payment and we’re simply unable to impose certain sanctions on an aggressor nation.

Member Board of Directors in Finance (non-banking), 201 - 500 employees

The EU and US did a fairly good job in terms of sanctioning, not the blockchain piece, but regular payments through the SWIFT banking system, although there was initial resistance to that. Russia’s Central Bank reserves that are outside of the United States have been frozen, so the traditional payment network accommodated the sanctions. The payments around their oil and gas sales have not been sanctioned, so that is continuing, but that's a conscious decision on the part of NATO, the EU and United States. 

Managing Partner & CISO in Software, 11 - 50 employees

What’s fascinating is that even though the US and other countries took Russia off SWIFT, there was a two-week period during which Russia was able to ensure that they had secondary direct payment rails with India and China. And when you sanction these types of payments, but don’t address oil sales, it's almost the same result. Russia was taken off SWIFT but they just decided to route the money through India or China instead, which is exactly what those countries did.

Board Member, Advisor, Executive Coach in Software, Self-employed
You should be able to sanction cryptocurrency but the question is whether that’s possible. From there, it just becomes an issue of potential policy enforcement. You might not be able to technically do it, but if I could legally compel you to not accept any cryptocurrencies, then that's a form of policy control that has nothing to do with the technical aspects. Sanctions on cryptocurrency could be enforced but you would have to create that compulsion on the part of banks and people in cryptocurrency businesses by establishing legal action and liabilities as the consequences of noncompliance. For example, there could be a takeover of their infrastructure if they didn't comply.
1 Reply
Managing Partner & CISO in Software, 11 - 50 employees

As a counter example, the US government has a requirement that if you fly with over $10K worth of cash or assets, you have to declare it. But if I've memorized my seed key, there’s a big debate over whether I have to declare that. It’s bizarre because I'm not actually traveling with the money, I'm traveling with the knowledge that can get me to the money, so it is a totally different world and ecosystem.

Chief Information Technology Officer in Finance (non-banking), 51 - 200 employees
Not really, despite all the arguments about the value of Blockchain, this is still a massive pyramid in many ways; wealth was created out of thin air and now we are suffering the consequences through inflation and economic concerns...

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