Sanctions are being imposed on cryptocurrency mining companies for the first time in history. The US Treasury Department announced that it is taking action against virtual currency mining companies across Russia. This information came out when IMF issued a statement saying, “the Kremlin may employ these activities to avoid compliance with international economic punishment.”
In the wake of recent sanctions, cryptocurrencies have been barely affected. Bitcoin consolidated its gains while ‘altcoins’ also performed in green.
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For example, Bitcoin is holding at $41,500 – $42,000. On Wednesday, it managed to reach a high since April 11th, above $42,000. But selling pressure rejected the bulls’ advance and failed to confirm the overcoming of this important resistance level. This is crucial for the virtual token par excellence to regain $45,000.
Naeem Aslam, head of analysis at AvaTrade, warns that “traders know that Bitcoin has to stay above this critical price level for the’ bulls’ to succeed.” The shortest-term support is now back to $40,000.
However, the expert warned that we should be careful. The IMF is in the spotlight because it says that some countries are using cryptocurrencies to avoid sanctions.
Countries like Russia and Iran use cryptocurrency to sell their oil and gas. However, there is also concern that they might be utilizing these resources for cryptocurrency mining, which provides another source of revenue and bypasses any sanctions against them.
“The IMF’s warning will certainly bring more regulatory attention to crypto companies, crypto exchanges, and crypto mining,” Aslam commented.
U.S. Treasury Designates Facilitators of Russian Sanctions Evasion
OFAC, the United States Office of Foreign Assets Control, sanctioned Bitriver AG, a Swiss-based holding company for cryptocurrency mining operations with offices in Russia and ten subsidiaries. This is the first time the U.S. Treasury has sanctioned cryptocurrency miners. Bitriver is amid a token pre-sale called BTR.
To curb Russia’s influence on cryptocurrency mining and trade worldwide, the U.S. has imposed new sanctions against BitRiver. The company operates vast server farms that sell virtual currency mining capacity internationally. In addition, this company helps monetize Russian natural resources.
The U.S. Treasury press release says that Russia has the advantage of energy resources and a cold climate for cryptocurrency mining. However, mining companies rely on imported computer equipment and fiat payments, making them vulnerable to sanctions.
The United States aims to make sure that no asset, no matter how complex, the Putin regime can use to reduce the impact of sanctions.”
Bitcoin And Altcoins Rising Despite The Risks
Despite these risks, the market positively responds and leaves rises for Bitcoin and altcoins. This has brought the total capitalization of cryptocurrencies to $1.92 trillion.
Related Reading | TA: Bitcoin Technicals Suggest Bulls Aim Sharp Move Above $42K
Ethereum’s price is currently trading between $3,000 and resistance at $3,200. The cryptocurrency has followed Bitcoin’s behavior and seeks to gain momentum toward overcoming the $42,000 resistance.
Terra is one of the most promising tokens on today’s gainer’s list, up 6%, along with Solana and Polkadot.
Featured image from Pixabay, chart from Tradingview.com
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