- The Kremlin was sanctioned by the Western countries, blocking most cross-border transfers.
- 21 crypto exchanges are, however, facilitating transfers using USDT.
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Amid sanctions against Russia following its 2022 invasion of Ukraine, transferring money abroad is becoming harder for citizens. But a new report shows that crypto exchanges in Moscow-City facilitate such payments.
Transparency International Russia, the country’s arm of the global anti-corruption organization, discovered money laundering schemes involving stablecoin Tether, that facilitates millions of remittances.
TI’s report, titled ‘From Moscow-City with Crypto,’ showed that 21 crypto exchanges in Moscow International Business Center accepted cash, exchanged stablecoins, and offered the possibility to sell stablecoins for cash abroad – 14 of which are over-the-counter (OTC) brokers. \
Crypto exchanges facilitating undercover transfers
Those facilitating the transfers, particularly to the UK, according to the finding, are Pridechange, Alfa.exchange, Mychange, Suex, Bitokk, Finex24, 24ExPay, and Trust-exchange. TI’s telegram chat with Suex, the exchange sanctioned by OFAC in September 2021, revealed that the platform could exchange 15,000 USDC for British pound sterling.
The demand for restricted money transfer services is reportedly high partly due to the restrictions on using Russian-issued bank cards abroad, and the no KYC documentation requirement. Amounts exceeding 10,000 USD, for instance, must be declared at customs when using air travel services, making illegal USDT transfers preferable.
In addition, few banks facilitate transfers through the financial messaging platform SWIFT, which locked major Russian lenders in the wake of its conflict with neighboring Ukraine. Additional restrictions were also imposed against Russian citizens by the European Union from accessing European crypto services.
Also revealed in the report is the amount of fees the exchanges charge for completing the USDT transfers. Suex reportedly charges 1.5%, while other brokers take 1-3%.
Of the 15 crypto wallets tracked by TI, the most active wallets received and transferred between $420,000 and $470,000 monthly. Most transfers used exchanges, including Binance, Huobi, MEXC, WhiteBit, and Garantex. MEXC and Garantex are domiciled in Russia.
The transactions are not without risk, “there is always the risk of fraud when you are doing business with OTC exchanges, as their websites usually do not contain any registration information about the legal entity you are dealing with. We are not 100% sure that these exchanges can be trusted,” TI noted.
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