Coinbase CEO Brian Armstrong said in a series of tweets Friday morning that if the U.S. government decides to impose a ban on Russian users on its site, the company “will of course follow those laws.”
Armstrong said he believes many Russians are using cryptocurrencies as a lifeline in the aftermath of an unprecedented string of economic sanctions against Russia that have destroyed the value of the ruble.
“We are not preemptively banning all Russians from using Coinbase. We believe everyone deserves access to basic financial services unless the law says otherwise,” Armstrong said in the Twitterthread. “Some ordinary Russians are using crypto as a lifeline now that their currency has collapsed. Many of them likely oppose what their country is doing, and a ban would hurt them, too.”
Since Russia invaded Ukraine last week, Coinbase—and the crypto industry at large—have faced mounting skepticism from lawmakers and government officials that Russian oligarchs will use cryptocurrencies to avoid sanctions, because they can be traded using online exchanges instead of banks and other intermediaries.
“There are growing concerns that Russia may use cryptocurrencies to circumvent the broad new sanctions it faces,” wrote a group of Senate Democrats in a Wednesday letter to Treasury Secretary Janet Yellen. “We are seeking information on the steps Treasury is taking to enforce sanctions compliance by the cryptocurrency industry.”
But recent data suggests this is not the case. Crypto activity in Russia was $34.1 million on March 3, down from $70.7 million on Feb. 24, the day Russia invaded, according to Chainalysis.
In his tweets, Armstrong said he did not think Russian oligarchs were taking advantage of cryptocurrencies to avoid sanctions.
“Because it is an open ledger, trying to sneak lots of money through crypto would be more traceable than using U.S. dollars cash, art, gold, or other assets,” Armstrong said.
Armstrong, who co-founded Coinbase—the country’s biggest cryptocurrency exchange company —in 2012 has a history of remaining neutral when it comes to taking a political stance.
In a September 2020 blog post titled “Coinbase is a mission focused company,” Armstrong encouraged his employees to avoid social activism and said that politics had become a “distraction.” As a result, about 60 employees—roughly 5% of the company’s workforce at the time—accepted exit packages and quit.