In a Meeting of the US Senate Select Committee on Intelligence yesterday morning (March 10, 2022), Senator Martin Heinrich (D-N.M.) inquired of FBI Director, Christopher Wray whether Russia could escape the effects of sanctions (particularly the banning of importation of Russian Oil and Gas) using gold reserves, China’s currency, or cryptocurrency [US Senate. Intelligence Committee Video. (Accessed March 10, 2022)].

With regard to cryptocurrency, Wray noted that the FBI has built up significant expertise in the area of digital assets, specifying the FBI’s recent seizures of large amounts of tokens evidencing the vulnerabilities present in utilizing cryptocurrencies in an attempt to evade sanctions. At the Hearing, Wray stated:

The Russians’ ability to circumvent the sanctions with cryptocurrency is probably highly overestimated on the part of maybe them and others… We are, as a community and with our partners overseas, far more effective on that than I think that sometimes they appreciate and there’s a lot of expertise in terms of tools and strategies to help block that kind of effort. Ultimately, what they really need to do is get access to some form of fiat currency, which becomes more challenging.

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According to Wray, utilization of fiat is a more likely vehicle for Russia to attempt in exploring methods of circumventing the imposed sanctions.

With high likelihood, Putin has anticipated the imposition of sanctions as a result of the Ukrainian invasion and had previously undertook to stockpile a reserve fund to ease the sanction’s economic impact. However, according to Avril Haines, Director of National Intelligence, efforts by the US Treasury as well as the other participating foreign governments to impose and enforce sanctions has made it difficult for Russia to access any reserve funds.

Author's Note: This article was originally published on Leo Finance and several other tribes on the Hive blockchain.