Overview of Russian Government’s Potential Use of Crypto Exchanges for Sanctions Evasion
Blockchain analysts caution that under new legislation, the Russian government may exploit crypto exchanges like Garantex for sanctions evasion. The government is expected to turn to domestic crypto exchanges like Garantex to circumvent sanctions as they adjust to the new crypto regulations, as highlighted by analysts at Chainalysis.
Garantex Identified as a Potential Tool for Sanctions Evasion
According to a recent blog report by Chainalysis, Garantex, a platform that has facilitated nearly $100 billion in transactions since 2018, provides deep liquidity across major blockchains, positioning it as a potential instrument for Russia to uphold cross-border trade amid financial constraints. While the report clarifies that the platform’s high transaction volume does not definitively indicate state-sponsored sanctions evasion, analysts caution that Garantex’s capabilities could be utilized for such purposes.
Role of Exved and InDeFi Bank in Sanctions Evasion
Analysts also point to the crypto exchange Exved as another potential avenue for sanctions evasion, particularly due to its association with InDeFi Bank, co-founded by Garantex founder Sergey Mendeleev and former KGB officer Alexander Lebedev. Exved has reportedly facilitated imports and exports, even prior to Russia’s recent cryptocurrency legislative changes, raising concerns about its involvement in sanctions evasion. These developments coincide with Russian President Vladimir Putin’s endorsement of Bitcoin mining and crypto trading, signaling a broader strategy to leverage crypto as a workaround for sanctions impacting Moscow’s international trade capabilities.
