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Major crypto exchanges have failed to prevent sanctioned Russian banks and traders from trading, according to a blockchain forensics report. At least two established coin trading platforms continue to allow Russians to use their bank cards in peer-to-peer deals, the analysis shows. It also highlights an increased Russian interest in tether.
Some of the world’s biggest digital asset exchanges have failed to take steps to prevent Russian banking institutions under sanctions from operating through their platforms, reveals a report by blockchain analytics firm Inca Digital, announced on the one-year anniversary of Moscow’s invasion of neighboring Ukraine.
According to the survey, cited by Bloomberg and Politico, merchants can still use debit cards issued by Russian banks sanctioned by the US, Canada, UK and EU, among others, including state-owned Sberbank, to transact at peer-to-peer banks. two-peer platforms (PTP) to two Seychelles-based exchanges, Huobi and Kucoin.
Inca CEO Adam Zarazinski explained that while neither accepts funds from the blacklisted banks, allowing crypto buyers to trade with each other using accounts with sanctioned institutions represents a “direct violation of US and European sanctions with a small loophole.” ” The stock exchanges have not yet commented on the findings.
The survey examined data on 163 crypto trading platforms, centralized and decentralized exchanges, as well as P2P and OTC (over the counter) service providers. Almost half of them allow Russian citizens to buy digital currencies, using various know-your-customer (KYC) requirements, trading limits and geolocation tools. Singapore-based Bybit, for example, allows users to convert rubles to crypto on its P2P platform and make fiat deposits, including through “any Russian-issued card.”
Binance, the industry leader in terms of daily trading volume, has also been mentioned, and the report identifies potential vulnerabilities. The authors note that the exchange offers “multiple methods for Russians to convert local currency to crypto,” including via the OTC and P2P marketplace, available to those without KYC checks for up to $10,000.
Chagri Poyraz, global head of sanctions at Binance, stated that the exchange is a “full-KYC platform and was the first major exchange to implement the EU’s crypto-related sanctions… Our P2P team takes the extraordinary extra step of filtering all forms of communication between users to ensure that there is absolutely no potential connection with Russian entities through any kind of solution,” he stressed.
The study also points to the use of tether to circumvent Western sanctions against Russia, noting an increase in discussions on Russian social media about the use of the stablecoin for money transfers. “Tether is often used by Russians to move money out of the country,” said CEO of Inca Digital. Both Binance and Tether have been under regulatory scrutiny in recent months.
What are your thoughts on the findings in the report from Inca Digital? Share them in the comments section below.
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