On March 10, blockchain analytics firm Chainalysis announced the launch of new tools for identifying crypto wallets that fall under sanctions.
The announcement comes as crypto's potential role in sanctions on Russia draws attention among policymakers and news publishers.
In an announcement shared with The Block, Chainalysis said:
"Given the transparency of blockchains, it would be difficult for the Russian government or financial elite to systematically evade sanctions at scale through cryptocurrency without detection. However, as with the traditional financial system, some sanctioned Russian actors may attempt to use cryptocurrency as a means to evade sanctions."
Launching today are Chainalysis' oracles, which are smart contracts identifying sanctioned wallets on Ethereum and EVM-compatible networks like Polygon and Avalanche.
Later this month, the firm plans to release a free API that will allow the public to identify wallet addresses under sanctions from all chains. A representative confirmed to The Block the inclusion of BTC and LTC wallets, which, along with ETH, have appeared on sanctions lists with the greatest frequency.
Chainalysis provides blockchain tracing tools to government agencies and law enforcement and helps crypto firms like exchanges identify high-risk wallets.
Crypto exchanges in particular have faced particular scrutiny over continuing operations in Russia, despite the fact that financial institutions are only barred from operating with certain financial institutions and specially designated nationals within the country.