BitPay agrees to pay $507,375 over sanction violation charges

US Department of Treasury’s OFAC announced that Bitcoin payment provider BitPay has agreed to a $507,375 settlement over violations of “multiple sanctions” related to crypto transactions.

BitPay allowed users from Ukraine, Cuba, North Korea, Iran, Sudan, and Syria to transact with merchants in US, using digital currency on its platform. OFAC has geographical sanctions in place in these regions and BitPay apparently facilitated “approximately $129,000 worth of digital currency-related transactions” with merchant customers from the aforementioned regions. 

According to OFAC, BitPay processed 2,102 transactions between 10 June 2013 and 16 September 2018, “on behalf of individuals who, based on IP addresses” and “invoices,” were located in sanctioned jurisdictions. 

In addition, the notice stated that the settlement amount reflected that the violations were not “voluntarily self-disclosed and were non-egregious.”

OFAC stressed that its sanctions programs apply to all crypto entities and stated: 

This action emphasizes that OFAC obligations apply to all U.S. persons, including those involved in providing digital currency services. 

Last year on 30 December, BitGo made a settlement with OFAC over allegations of 183 violations for facilitating crypto transactions via its wallet services to users in sanctioned areas between 2015 and 2019.

At the time, OFAC said that the settlement with BitGo highlighted that crypto-focused companies should understand sanction-risks that come with providing crypto services. OFAC believed that the case also represented the fact that such entities must take steps necessary to mitigate those risks.