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Ukraine war

U.S., Japan and EU rush to close crypto loophole in Russia sanctions

Decentralized assets seen as haven with ruble crashing and banks cut off

Bitcoin-ruble trading volumes swelled in late February as Russia was hit with sweeping financial sanctions.   © Reuters

TOKYO -- Japan and its Western peers are racing to crack down on cryptocurrency transactions by Russians trying to dodge sanctions imposed after Moscow's invasion of Ukraine, but the effort faces enormous challenges because the targeted assets are decentralized and lack single administrators.

The U.S., Japan and the European Union blocked major Russian banks from the SWIFT global payment network as part of the sanctions, temporarily sending the value of the ruble down 30%. This has prompted Russian individuals and businesses to turn to cryptocurrencies for sending their money offshore -- a loophole that countries involved in the sanctions are aiming to close.

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