Authorities in Japan instructed its domestic cryptocurrency exchanges to cease transactions with Russian and Belarusian organizations and individuals sanctioned due to Moscow’s invasion of Ukraine. By this move, the East Asian nation joins the likes of Switzerland and Singapore in halting digital asset transactions further isolating Russia from the crypto market.
In view of Belarus supporting Moscow’s aggression, 19 individuals, including President Alexander Lukashenko, and 15 organizations have been subjected to sanctions.
the latest development has its roots back in early March when Japan’s financial regulator and the country’s industry body announced that they were working on implementing restrictions to prevent Russia from bypassing sanctions through crypto. Japan’s Finance Minister at the time stated,
“We are closely watching the situations of settlements such as crypto assets and SPFS in order to secure the effectiveness of sanctions against Russia.”
Japan, along with the United States and other G7 nations, has frozen the assets of Russian President Vladimir Putin and certain other officials following the invasion.
According to a release, a few days ago, the G-7 leaders said, “We will ensure that the Russian state and elites, proxies, and oligarchs cannot leverage digital assets as a means of evading or offsetting the impact of international sanctions.”
Japan gov to take strict action against violators
As per sources, a total of 30 cryptocurrency exchanges based in Japan have been asked not to transfer assets targeting 44 Russian individuals. A report by Forkast further revealed that the Financial Services Agency and Ministry of Finance announced the penalties against violations.
In the joint statement, the agencies informed that crypto exchanges making unauthorized payments to sanctioned individuals could invite fines up to 1 million yen [$8,500], with individuals facing jail time of three years.
The government also asked the exchanges to monitor crypto-assets and report to financial authorities of any suspicious transactions that may involve those who are subject to the sanctions.
Last year, cryptocurrency transactions over exchanges in Japan jumped 51% in the first 11 months to 103 trillion yen [$900 billion], based on data compiled by the Japanese Virtual Currency Exchange Association. But even as the local industry kept growing, the country’s presence in global crypto markets has been waning and that has further affected due to the current situation.