Deribit, a leading crypto exchange, has made the decision to ban Russian nationals and residents following the imposition of new EU sanctions. Despite being based in Dubai, the exchange's parent company, which is Dutch, must adhere to EU economic restrictions.

With Russians accounting for a significant portion of its user base, this move could have a substantial impact on Deribit. The exchange has announced a complete withdrawal from the Russian market in light of these developments.

Exceptions will be made for Russian-born individuals holding citizenship or permanent residency in the European Economic Area. However, all Russian firms are explicitly prohibited from trading on Deribit.

The shift in policy comes as a response to the evolving landscape of international sanctions that have become intertwined with Russia's cryptocurrency ecosystem. Notably, digital assets have gained popularity in Russia due to their perceived ability to circumvent economic restrictions.

Despite facing regulatory hurdles in the past, Deribit had continued to operate in Russia, only to be compelled to change course due to the latest EU sanctions. The exchange's recent relocation to Dubai in 2023 did not shield it from this decision, as even Russian nationals residing in the UAE are prohibited from registering with Deribit.

This move adds to a series of challenges for Deribit, including recent considerations of an acquisition by Kraken. While the exchange has garnered a notable user base in Russia, it remains overshadowed by its competitors in the region.

In the larger context of the crypto community in Russia, these sanctions may pose a greater threat to Deribit than to the overall ecosystem. This development underscores the significance of decentralized systems within the crypto sphere, offering alternative solutions to navigate the complexities of international sanctions.