Russian Lawmaker: No Total Crypto Ban Plans

More than 50 Beribit clients gathered for a protest at the Federation Tower in Moscow, where the Russian crypto exchange has its offices. The protest, which occurred on April 26, stemmed from the inability of clients to withdraw their funds—totaling approximately 400 million rubles. While deposits proceeded without issues, withdrawals remained problematic, sparking considerable frustration among investors.

The situation escalated when Beribit employees tried to exit the building through alternative routes, only to find their paths blocked by the aggrieved clients. This led to police stepping in to manage the situation. Amid the turmoil, a video surfaced on Telegram showing the exchange’s unusual response to the crisis: distributing chocolates to the protestors instead of resolving their financial grievances.

Exchange’s Response and Legislative Moves

Following the upheaval, Beribit responded through their official Telegram channel, citing recent management changes that unveiled balance sheet discrepancies. This revelation has necessitated a thorough audit of the exchange’s books. Beribit also stated that a backlog in handling deposits and withdrawals was due to new requirements for clients to complete KYC/AML verifications.

Despite the disruptions, Beribit assured that clients who clear the KYC/AML processes will regain full access to their accounts. In the meantime, Gazeta.Ru reported that Beribit promised to refund 50% of the affected investments immediately, with the remainder to follow within 15 days.

Amidst these company-specific issues, broader regulatory challenges are emerging. A new bill introduced in the State Duma seeks to ban crypto exchange operations, though it would not impact crypto transactions or registered mining activities. The proposed legislation also aims to outlaw cryptocurrency advertising. However, some legislators argue against such a ban, suggesting that it could undermine Russia’s national security by limiting access to crucial non-Western sources and tools for evading sanctions.

As this situation develops, Beribit remains under scrutiny. The exchange had previously attracted law enforcement attention with office searches in March related to an investigation of a terrorist act at Crocus City Hall. Additionally, a temporary website outage at that time was linked to the ongoing investigations.