US senators have put forward a proposal to block Russia’s gold reserves. Meanwhile, the White House is expected to impose a ban on imports of Russian oil on Tuesday.
The United States continues to work to implement stronger economic sanctions on Russia amid the armed invasion of Ukraine.
A group of United States senators have introduced a bill to block Russian gold reserves. The regulation focuses on Russia’s ability to sell its gold reserves and would impose sanctions on anyone who buys or sells the Russian precious metal. The move is an effort to obstruct one of the possible funding avenues still available to the Russian government.
As reported by the media Axios, the bipartisan bill was introduced by Angus King (I-Maine), John Cornyn (R-Texas), Bill Hagerty (R-Tenn.), and Maggie Hassan (DN.H). The legislation seeks to prevent anyone from transacting or transporting gold from the Russian central bank’s reserves, or from selling gold physically or electronically in Russia.
“Russia’s massive gold supply is one of the few remaining assets that Putin can use to prevent his country’s economy from falling further.”, King said in a statement quoted by that medium. “By sanctioning these reservations, we can further isolate Russia. of the world economy and increase the difficulty of Putin’s increasingly costly military campaign.
Bill to block Russian gold
In accordance with Bloomberg, Russia’s gold reserves were valued at $132.3 billion at the end of January; and they are the fifth largest sovereign reserves of the precious metal in the world. The European powerhouse has been buying gold relentlessly for years in an effort to reduce the US dollar’s place in its reserves.
The news comes after the US and Western allies imposed a series of sanctions on Russia. Major Russian banks were removed from the SWIFT interbank payment system while payment companies Visa, master card and PayPal they have stopped their services to Russian entities and individuals.
Restrictive measures have also been applied to block the assets and finances of various top officials in the country, including sanctions on Russian President Vladimir Putin. The US Treasury Department has banned US individuals and entities from doing business or transactions with the Central Bank of Russia in an effort to immobilize sovereign wealth funds.
The bipartisan proposal appears to be an effort to expand the Treasury sanction. While those sanctions already prevent Russian gold from entering major markets in New York and London, the passage of such legislation could deter banks in countries like China and India from buying or lending against Russia’s sovereign gold reserves; as noted Bloomberg.
The goal is to include the legislation in the general spending bill that US lawmakers hope to pass on Friday. This was indicated by an assistant familiar with the matter to Axios. The US Congress is also expected to introduce aid for Ukraine in that bill, although it is not yet clear whether an oil ban or additional sanctions will be included.
Waiting for an oil ban
The news about the proposed law comes amid growing expectations that the US government will announce a ban on imports of Russian oil. According to various news outlets, including CNBC and Reuters, The White House is expected to impose the ban as early as Tuesday.
Democratic US Senator Chris Coons advanced in an interview with CNN that a ban announcement could come as early as this Tuesday or Wednesday. Sources familiar with the plans also confirmed this information to the media.
In accordance with ReutersRussia is the world’s largest exporter of oil and natural gas, and until now its energy exports were exempt from international sanctions. The announcement would intensify the impact of war and sanctions on an economy already in ravage, with the Russian ruble falling to record lows and businesses withdrawing from the country.
The news comes shortly after the British shell join the list of Western oil majors that have announced their withdrawal from Russian projects. shell said on Tuesday that it will no longer buy Russian gas or oil and apologized for buying a shipment of crude last week, after Putin announced a “special military order” to invade Ukraine.
Will Russia use the Bitcoin card?
As for efforts to lock up Russia’s gold reserves, some cryptocurrency industry watchers have suggested such moves could motivate Russian government and officials to turn to digital assets like Bitcoin as a way to circumvent sanctions.
However, some are not so sure that Russia can effectively take refuge in cryptocurrencies for this purpose. That has been the opinion of the policy chief of the Blockchain Association for the US, Jake Chervinsky, who believes that concerns by governments and legislators about Russia being able to take advantage of cryptocurrencies to evade sanctions were being unfounded due to ignorance about how the markets for these assets work.
Along these lines, it has also been suggested that regulators in the US and the European Union could take advantage of the current armed conflict in Eastern Europe as the perfect excuse to introduce greater and stricter regulations to the digital currency sector.
Article by Hannah Estefanía Pérez / DailyBitcoin
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