US and UK authorities are examining these transfers to counter the violation of economic restrictions

Media: Garantex exchange conducted USDT transactions worth $20 billion after sanctions were imposed

28.03.2024 - 15:35


4 min

What’s new? Authorities in the US and UK have begun looking into USDT $20 billion worth of crypto transfers in stablecoins that went through the sanctions-listed Russian crypto exchange Garantex. The initiative is aimed at combating the evasion of economic restrictions. USDT issuer, Tether, said it is cooperating with law enforcers to ensure compliance.

Material by Bloomberg

What else is known? According to Bloomberg’s anonymous sources, the transfers of interest to the authorities were made after the US and UK imposed sanctions on Garantex on suspicion of facilitating financial crimes and illegal transactions in Russia.

The $20 billion transactions represent one of the largest violations since the imposition of economic restrictions against Russia.

Media sources warned that the investigation is ongoing and it is too early to anticipate its conclusions, given the complexity and opacity of crypto transactions. They also emphasized that the authorities have not raised the issue of wrongdoing by Tether in connection with these transfers.

Tether blocked all USDT wallets from the US Treasury Department’s sanctions list on its own initiative back in December last year, without waiting for an order from the authorities.

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Earlier this month, Garantex said it was committed to preventing the exchange from being used for illegal purposes and was actively cooperating with authorities in Europe and the United States until it was sanctioned. The company says it continues to cooperate with other international law enforcement agencies and tries to avoid facilitating criminal activity.

Garantex was founded in 2019 in Estonia, but after US sanctions were imposed in April 2022, the local financial regulator revoked its license. At the time, the US linked Garantex to more than $100 million in illegal transfers made by, among others, the Russian hacking group Conti, an extortionist group. The authorities emphasized that the exchange deliberately refused to comply with AML rules.

According to US authorities, most of the exchange’s activities are currently conducted from the Federation Tower in the Moscow City business center.

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In March of this year, the US authorities brought similar charges against the KuCoin exchange. The platform allegedly deliberately refused to comply with AML rules, which allowed it to take a significant market share in a short time and at the same time attracted criminal funds. Following the charges, the exchange experienced an outflow of funds. KuCoin announced an airdrop of $10 million among those who faced withdrawal problems amid these events.

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