News

IRS Supports Ukraine In Crypto War Against Russia

Key Points:

  • In pursuing sanctions evaders, the IRS criminal investigative division is increasing engagement with peers abroad.
  • The agency collaborates with Chainalysis, a blockchain analytics company, and Ukrainian investigators.
  • Virtual training was attended by around 50 Ukrainian law enforcement professionals.
According to a Thursday release, the US Internal Revenue Service (IRS) and crypto investigations firm Chainalysis is collaborating with Ukraine to pursue Russian billionaires who may be utilizing cryptocurrency to avoid sanctions.
IRS Supports Ukraine In Crypto War Against Russia 3

In the midst of Russia’s continuing invasion of Ukraine, the US and its private sector allies seek to assist Ukrainian authorities in preventing Russian actors from utilizing cryptocurrency to avoid sanctions, something European authorities have previously attempted to address.

The IRS Criminal Investigation (IRS-CI) section provides blockchain analysis tools to Ukrainian investigators. The IRS gave Ukraine licenses from the crypto investigative firm Chainalysis. Virtual training was attended by around 50 Ukrainian law enforcement professionals, with in-person training yet to follow.

According to the IRS, the measures are aimed at promoting information exchange and case development between the United States and Ukraine. IRS Criminal Investigation Head Jim Lee said in a statement:

“Sharing tools not only safeguards the US financial system, but the global economy.”

Regulators, central bankers, and policymakers have warned that nations such as Russia and Iran may use cryptocurrency to circumvent international sanctions. Binance, the world’s biggest cryptocurrency exchange, is under investigation in the United States for allowing Russians to unlawfully use its website.

Crypto is currently too illiquid to facilitate large-scale Russian sanctions evasion, but it does occur on a smaller scale, according to Michael Gronager, co-founder and CEO of Chainalysis, during a conference call with reporters on Thursday. According to him, it is impossible to assess how much Russian oligarch money is coming through Ukraine since the effort to detect such transactions is ongoing.

IRS Supports Ukraine In Crypto War Against Russia 4

Following Russia’s invasion of Ukraine, the nations have utilized cryptocurrency to fund military operations, avoid sanctions, and aid humanitarian missions. Data suggests that cryptocurrency is not playing a significant part in Russia’s military effort. Yet, US politicians are worried that Russian billionaires may be exploiting crypto to avoid US and European economic sanctions.

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Harold

Coincu News

Harold

With a passion for untangling the complexities of the financial world, I've spent over four years in financial journalism, covering everything from traditional equities to the cutting edge of venture capital. "The financial markets are a fascinating puzzle," I often say, "and I love helping people make sense of them." That's what drives me to bring clear and insightful financial journalism to the readers of Coincu.

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