The conflict between Russia and Ukraine is bringing a lot of economic sanctions into the fold. Countries around the world are attempting to punish Russia for its invasion. Yet, many are pointing to crypto as a place of refuge for the world’s largest nation. There has been a lot of chatter this week about crypto exchanges blocking Russian addresses for crypto. But, as Binance (BNB-USD) founder and crypto celebrity Changpeng Zhao says, things aren’t as simple as many may think.

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Last week, Russia brought an eight-year long dispute with Ukraine to a tipping point. The dispute originates with Ukraine potentially joining the North Atlantic Treaty Organization (NATO). In 2014, the Ukrainian Revolution brought a pro-West president to power in the country. Russia then responded by annexing the Crimean Peninsula. After years of fighting, the conflict has now ramped up significantly in the last week.

This conflict is putting the U.S. and other NATO nations in a tough position. To take military action in support of Ukraine would put nuclear powers at odds. Thus, there is no possibility for any of these nations to take action. Rather, the U.S. is supporting Ukraine via funding. It’s also implementing a series of harsh sanctions on Russia.

In addition to a lengthy list of sanctions, the U.S. government is also being joined by American companies who want to help suffocate the Russian economy and force Russia out of Ukraine. Among the corporations taking Russia to task are tech giant Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) and financial services mainstay Visa (NYSE:V).

Some Say Russia Can Use Crypto to Subvert Sanctions

One of the most crippling sanctions levied against Russia is the one cutting many Russian central banks from The Society for Worldwide Interbank Financial Telecommunication (SWIFT), a major global bank messaging system. SWIFT is a robust network for thousands of banking institutions across over 200 countries.

Recently, InvestorPlace’s Eddie Pan detailed the implications of this ban, which was a theoretical punishment at the time. This morning, the ban has actually taken place; the European Union (EU) is barring seven Russian banks from SWIFT.

Of course, these blows to the Russian banking industry are heavy and detrimental to the future of the country’s economy. Still, some believe that they can be subverted by the nation, thanks to the ubiquity of cryptocurrency. True, the SWIFT ban disconnects Russia from the largest network of institutions in the world. However, it does not keep it locked out of the $2 trillion crypto industry.

This realization is prompting discussion around whether crypto is a viable option for Russia to avoid the worst of the sanctions. It’s also leading to swift action from the United States. As of now, the U.S. Department of the Treasury is seeking to prohibit transactions of cryptocurrency to Russian addresses.

Regulators Call to Block Russian Users From Exchanges

The Unites States’ new sanctions specifically target Russia’s potential use of the crypto industry. Atop this, there are calls for exchanges to blanket-ban Russian users from their platforms. On Monday, the Ukrainian government asked Binance, Coinbase (NASDAQ:COIN) and several other large exchanges to prevent Russians from using their platforms.

The request is multifaceted. For one, it asks these exchanges to bar Russian addresses from connecting to their services. But it also asks that these exchanges drop support for the Russian ruble.

The idea behind this ban stems from a worry that Russian oligarchs will exchange their fiat assets for crypto in an effort to obfuscate them and avoid banking woes. In the last week, the ruble’s value has tanked from the effects of the sanctions; by quickly exchanging rubles for store-of-value investments, they can avoid the rapid inflation.

Of course, other sanctions cut Russia off from typical store-of-value commodities like gold. However, they don’t touch digital currency. That is, unless exchanges really do bar users. As recent news suggests, though, that won’t likely be the case.

Crypto Exchanges Push Back

In a somewhat controversial response, several exchanges say that they do not have any plans to blanket-ban Russian users. Coinbase made headlines as one of the first exchanges to come out against this request, saying the action would unfairly punish Russian citizens who already have to endure deep economic instability. Binance, the largest exchange in the world, is backing up this decision. It will not be blocking Russian users from its services either.

In an interview with Bloomberg this morning, Binance founder Changpeng Zhao reiterated his stance against blocking Russian addresses on the platform. Previously, Binance had said that unilaterally banning people’s crypto access would “fly in the face of the reason why crypto exists.”

So, Zhao is arguing against taking further action against Russian crypto traders. Still, the founder asserts that Binance and other exchanges are also following the same regulations placed on banks and traditional financial institutions. Indeed, like international banks, these exchanges have been tasked with the same duties to freeze Russian assets in accordance with the sanctions. A list of Russian oligarchs and other figures associated with the ongoing conflict has been distributed to them.

However, when it comes to Ukraine’s call to freeze all Russian accounts, these exchanges are being far more hesitant. Zhao says any further bans would be unethical: “We differentiate between the Russian politicians who start wars and the normal people […] Many normal Russians do not agree with war.”

Could a Blanket-Ban Stop Russian Crypto Trading?

Changpeng Zhao and other exchange executives are publicly taking an ethical stance on this issue; they show obvious concern for Russian people who don’t support the war and are standing up for the essence of what crypto is. While this is all fine and good, though, there is still an obvious financial incentive at play.

Russia is a massively growing crypto market, with nearly 12% of Russians owning crypto in the country. Exchanges are a valuable tool for growing this demographic as well. So, a blanket-ban would prevent exchanges from capitalizing on the growth potential.

These exchanges’ concerns might seem blasé in the face of a devastating war. However, there is also a host of crypto-industry leaders arguing that a blanket-ban wouldn’t actually have a negative effect on Russia anyway. Some experts call the concerns around subverting sanctions “unfounded.” Others say the industry is not yet in a position to support the volume Russia would need in order to truly brush off sanctions. Plus, some say that, even if the industry could support all of the country’s economic activity, the volume would be very obvious and easy to track on the blockchain.

Ultimately though, as Changpeng Zhao points out, exchanges are not even a necessary component of trading crypto. “All you need is a wallet,” he clarifies. Thus, even if exchanges fully blocked Russian users, there are still ways they could be able to move assets around.