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US and UK Look Into Presumed $20 Billion Cryptocurrency Transactions Associated With Moscow Dodging Sanctions

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To counter any strategies Moscow may use to get around sanctions during its war with Ukraine, the US and the UK have stepped up their investigation into more than $20 billion in cryptocurrency transfers that were purportedly processed through a Russian exchange. This probe, according to a Bloomberg article, emphasizes the continued efforts of Western countries to crack down on illicit financial operations that exacerbate geopolitical tensions.

According to sources who spoke with Bloomberg, Tether—a popular dollar-pegged stablecoin—was used in these transactions, which were processed by the Moscow-based cryptocurrency exchange Garantex. The enormous amount denotes one of the worst violations of sanctions against Russia since the war began, as demonstrated by the Biden administration’s takedown of cryptocurrency exchanges linked to the Kremlin in February 2022. Experts advise against drawing hasty conclusions, though, because bitcoin transactions are complex.

These transfers, which were mostly made in Tether, a stablecoin that is frequently used to convert between cryptocurrencies and fiat money, highlight the secrecy and ease that cryptocurrencies provide while also posing difficulties for regulatory control. Although Tether Holdings is not now suspected of any wrongdoing, its adaptability has made it a desirable tool for fraudsters looking to hide their financial activity.

Garantex was founded in Estonia in 2019 and later moved its headquarters to the Federation Tower in Moscow. But Estonia canceled its license to operate in response to US efforts to limit the exchange’s operations. In April 2022, the US Treasury imposed punitive restrictions against Garantex, citing the exchange’s suspected involvement in enabling over $100 million in unlawful transactions carried out by criminal organizations including the Russian ransomware gang Conti.

Strong anti-money laundering and counter-terror funding procedures are crucial inside the cryptocurrency ecosystem, as demonstrated by the US Treasury’s censure of Garantex for allowing illegal actors to abuse its infrastructure. Authorities try to reduce the possibility that cryptocurrencies may be used to finance illegal activity and get around international restrictions by putting exchanges under regulatory surveillance and imposing sanctions.

This most recent event highlights how financial warfare is changing and how cryptocurrencies are being used as a vehicle for illegal activities as well as a target for regulation. The relationship between cryptocurrencies and international sanctions will continue to be a focus point for policymakers looking to protect the integrity of the global financial system as long as geopolitical tensions exist.

The US and UK are working together to tackle illicit financial activity connected to Moscow’s sanctions evasion, as seen by the investigation into the estimated $20 billion in cryptocurrency transfers that were channeled through a Russia-based exchange. In order to protect against financial wrongdoing on a worldwide scale, authorities must perform more monitoring and collaborate with other countries as they traverse the challenging landscape of cryptocurrency legislation.

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