LISBON — The head of the largest cryptocurrency exchange by volume said new and stronger EU sanctions have created a "tricky situation" for dealing with Russian users.

"We are not against any people," said Binance CEO Changpeng Zhao, holding a press conference during the Web Summit here on Wednesday. "We are against dictatorships of war. We’re not against the population. But as a business, we’re licensed in many different places. We have to follow the rules," he added.

Asked by CoinDesk whether Binance will follow the decisions of LocalBitcoins, Crypto.com, Kraken and other peers to expel their Russian users, Zhao said he did not have a definitive answer yet.

"It's a tricky situation," he said. While Binance's licensed entities in Europe – France, Italy, Spain, Lithuania, and Sweden among them – definitely wouldn't be able to serve Russian citizens because of sanctions since Russia's invasion of Ukraine, he said the question is less straightforward in jurisdictions outside the EU.

"We are communicating with the regulators on whether it's OK for us to service Russian users," he added. "How it plays out internationally, we have to see. We're waiting for expert recommendations. It’s a tough situation."

Zhao has previously called Russia a "key market" for Binance, and the exchange has been fairly popular in that country.

Russian citizens' accounts at EU-based crypto services have been being shut down for the last month after the bloc added to its sanctions regime against Russia to punish the country for the ongoing war in Ukraine.

The new rules expanded an earlier ban on digital wallets for Russian citizens containing more than 10,000 euros worth of assets. In the latest iteration introduced Oct. 6, the sanctions prohibited crypto asset wallet, account or custody services to Russian citizens, residents and legal entities, "irrespective of the amount."

Major European-based crypto services, including LocalBitcoins, Crypto.com and Blockchain.com, immediately sent Russian users notifications that their accounts would soon be discontinued. Kraken, a U.S.-based exchange with branches in Europe, also restricted accounts of Russian citizens, the Russian-language news website Forklog reported.

Unsurprisingly given such a broad policy, there appear to be at least some cases where sanctions penalized Russians who did not support the war in Ukraine and did not live in Russia, CoinDesk reported.

Read more: EU’s Russian Crypto Ban Confirmed as Bloc Tightens Sanctions

Crypto appears to be where these sanctions have hit the hardest because there have been no similar measures regarding bank accounts for Russian citizens residing in Europe. Also, while the EU is gradually reducing its dependence on Russia’s oil and gas, the latest sanctions still allow European operators in certain cases to help Russia transport its oil for sale in third countries.

The focus is somewhat baffling to Zhao, who said at his press conference, "Why are the sanctions harder on crypto services than on banks?"