US Hits Russian Crypto Exchange with Sanctions, Russian Central Bank Affraid That Crypto Will Replace Ruble
The United States has hit the crypto exchange Garantex with sanctions, claiming that it has “willfully disregarded” anti-money laundering and countering the financing of terrorism (AML, CFT) obligations and “allowed” its “systems to be abused by illicit actors.” A joint Washington-Berlin effort has also closed down darkweb servers in Germany – while the Russian Central Bank says it is still opposed to crypto adoption.
In an official release, the American Department of the Treasury’s Office of Foreign Assets Control (OFAC) wrote that analysis of “known Garantex transactions shows that over USD 100 million in transactions are associated with illicit actors and darknet markets.”
The exchange has previously worked with the Russian oligarch Alexander Lebedev, and was until very recently registered with the Estonian regulator.
However, OFAC noted:
“In February 2022, Garantex lost its license to provide virtual currency services after supervision by Estonia’s Financial Intelligence Unit revealed critical AML/CFT deficiencies and found connections between Garantex and wallets used for criminal activity.”
This figure, OFAC claimed, included “nearly USD 6 million” from the Russian ransomware “gang Conti.”
It also included “approximately USD 2.6 million from Hydra Market,” the agency added. And Hydra – called “the world’s largest and most prominent darknet market” in the release was the subject of a joint operation also involving German authorities.
OFAC wrote that the German Federal Criminal Police had “shut down Hydra servers in Germany and seized USD 25 million worth of bitcoin (BTC).”
Hydra has also been sanctioned.
The Treasury Secretary Janet Yellen was quoted as stating:
“Our actions send a message today to criminals that you cannot
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