Ukraine Lawyer Says Country Has Received Numerous Russian Wallet Addresses for Crypto 'Blacklist'

Ukraine also promised a reward for the information, but the exact amount will depend on how much is used for the military resistance.

Mar 1, 2022 at 9:35 a.m. UTC
Updated Mar 1, 2022 at 4:14 p.m. UTC

Amitoj Singh is CoinDesk's regulatory reporter covering India. He holds BTC and ETH below CoinDesk's disclosure threshold of $1,000.

Ukraine has received tons of crypto wallet addresses connected to Russian politicians after the nation mounted an effort to find and blacklist such wallets, said Artem Afian, the private lawyer entrusted with the responsibility.

“Our idea was that the war criminals will try to avoid sanction through crypto and we want to get them there,” said Afian.

The de facto head of crypto matters in the Ukraine, Mykhailo Fedorov, asked for this information on Saturday. Fedorov, the deputy prime minister and minister of digital transformation, tweeted a clarion call for information on crypto wallets held by Russian and Belarusian politicians.

'Blacklist' efforts in full steam

Speaking to CoinDesk from an undisclosed location, Afian said he is fighting the crypto part of the war for Ukraine while worrying about his safety and the safety of his parents. “It’s not aggression. It’s a war with real bombs. It’s crazy. My parents are alive but I don’t know if they are safe,” he said.

At the moment, Afian’s team has only identified a few prominent names but he hopes that after double-checking all the wallets there will be plenty more. Afian’s team is coordinating with the Ministry of Digital Transformation, a familiar wing of the government for Afian, who was part of the working group that developed the law on virtual assets in Ukraine.

An integral part of preparing the blacklist is to “help all crypto exchanges in the world tag these politicians, their families, partners, children.” He intends to convince the exchanges to “stop working with the politicians, to squeeze them out of the crypto world.”

Ukraine has also asked several crypto exchanges to block Russian user accounts to make sure sanctions placed on Russia are effectively implemented.

Afian added that he has been getting "threats from them," but is "happy to read” those threats because it makes him believe he is “doing the right thing.”

There are loopholes to this strategy because Russian and Belarusian politicians could use cold wallets, meaning a wallet not connected to the internet. However, Afian wants the crypto exchanges to make it “toxic” for these politicians and to let them know that “sooner or later we will get them.”

“For me it is personal. My four-year-old son woke up because of bombs. I can never forgive this. [Russia] voted for war. I cannot make them suffer directly but I do what I can to punish them,” he said.

'Bounty' will depend on the remaining war funds

The deputy prime minister had also promised a bounty for information on the wallets. Afian said the exact amount will depend on a number of factors. “It depends, [because] a majority of our funds could go towards the military resistance. But it could be five or 10 bitcoins or more,” he added.

According to Afian, this is a watershed moment for decentralized finance (DeFi), or the process of conducting financial transactions on a blockchain without middlemen.

“If the crypto world can show that without centralization it can stand against crime, then people will trust crypto. If the crypto world fails Ukraine, there may not be any future for crypto.”

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Amitoj Singh is CoinDesk's regulatory reporter covering India. He holds BTC and ETH below CoinDesk's disclosure threshold of $1,000.

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Amitoj Singh is CoinDesk's regulatory reporter covering India. He holds BTC and ETH below CoinDesk's disclosure threshold of $1,000.

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