Fire your Russian employees.

Then withdraw.

Hurts but if history should learn us a thing or two one of them should be not to give in to dictators.

The younger ones here are allowed to take a few minutes off to use their favorite search engine to look up the quote "peace in our time" by Chamberlain.

Edit:

It looks so simple the way I wrote it above. Please note that doing the right thing isn't easy. Telling lots of people their job is gone. Telling investors the money invested in one of the most promising markets is gone etc etc.

But I am afraid that sooner or later the alternative will be worse.

Option 3: choose to make less money and don't have offices in countries with human rights records as bad as russia. I know this isn't realistic, because we can't expect a company to make less money. that'd be crazy!

No - this is elementary game theory. By precommitting to "if I withdraw the app I will go to jail", then the Russian threat would become ineffective and they wouldn't make it to begin with.

Granted, the real world is more complicated but this is equivalent of using the strategy of disabling your steering wheel before playing a game of chicken.

The only winning move is not to play (i.e. don't have offices in authoritarian states)