Binance is re-evaluating its Russian business with an option of full withdrawal, the Wall Street Journal reported citing the representatives of the world’s largest cryptocurrency exchange.   

Previous reports by the WSJ claimed that Binance was helping Russians move money abroad. Binance said in 2022 it had stopped working in the country amid the full-scale military invasion of Ukraine, was implementing Western sanctions requirements and had restricted trading in Russia. 

The exchange had also limited peer-to-peer trading involving sanctioned Russian banks and blocked the exchange of digital tokens into currencies other than rubles.

The WSJ reminds that amid major regulatory crackdown in the US, Binance acknowledged previous compliance failings and hired a former Morgan Stanley executive, Noah Perlman, as its compliance chief.

But the US Justice Department is already investigating whether Binance was used illegally to let Russians bust US sanctions, previous reports by Bloomberg claimed.

Binance announced in April 2022 that following the EU’s fifth sanction package, it is “required to limit services for Russian nationals or natural persons residing in Russia, or legal entities established in Russia, that have crypto-assets exceeding the value of €10,000”. Another exchange, Coinbase, also warned Russian users that their accounts will be blocked on May 31.

Additionally, the European Union imposed a total ban on carrying out cryptocurrency transactions with Russian citizens and anyone residing in the country as part of its eighth round of sanctions. The US Treasury Department also targeted Swiss-based Russian crypto-currency mining holding BitRiver in September.

But Russia had taken the first step towards international crypto-payments when the Russian Ministry of Industry and the Central Bank of Iran agreed that imports could in theory be processed using crypto-currencies last August.

As followed by bne IntelliNews, in April 2023 Russia had overtaken Kazakhstan to become the world's second-largest cryptocurrency mining country.

After initially rejecting the idea of cryptocurrencies, the famously conservative Central Bank of Russia (CBR) has more recently softened its stance on the potential use of cryptocurrency as a recognised means of payment. Deputy head of the CBR Xenia Yudaeva said the regulator was toying with the idea of allowing the use of crypto for international payments and signalled a more lax stance on crypto-mining in June last year.

In search of solutions to avoid sanctions restrictions, Russian Prime Minister Mikhail Mishustin added his name to the roster of Russian high officials endorsing the use of digital money to settle international trade deals in September 2022.