One of the oldest and frankly laziest critiques of crypto is that it is not regulated. Another misconception is that crypto’s purpose is to be an unregulated alternative to the traditional financial system. The events unfolding in Europe now are proving that while it is true that crypto is an alternative financial system, it is a strongly regulated and compliant one.
One of the most effective weapons used in war is economic sanctions. Several Russian banks have been cut off from the SWIFT system, effectively isolating them from the global financial system. Similarly, requests have been made by the Western governments to several cryptocurrency exchanges to ban Russian citizens from their platforms. Crypto exchanges refused to enact a blanket ban, but they, of course, agreed to ban specific sanctioned accounts of targeted individuals. This is a milestone moment for crypto as it proves that regulated exchanges are subject to the same financial regulations as traditional financial institutions.
One of Crypto’s objectives is to be a more equitable and fair financial system, where ordinary people cannot have their wealth confiscated or trapped because of geopolitical forces that are no fault of their own. Crypto can accomplish this while also being compliant with international sanctions. For the first time ever, we are seeing crypto play a key role in a global geopolitical conflict, a neutral yet regulatory-compliant role.