In a recent crackdown, Moscow police have dismantled a suspected “cross-border” cryptocurrency exchange that they believe facilitated illegal money transfers for Russian clients. Officials reported that the operators disguised their activities as a travel agency, using the facade to conduct significant cryptocurrency transactions.
According to the Russian Interior Ministry, the suspected exchange processed approximately $2.2 million in crypto transactions. During a raid on their offices, police alleged that the operators engaged in “illegal banking activities,” charging a 1% commission fee for cash payments made by customers wanting to transfer funds to foreign crypto wallets.
Footage released by the ministry showed officers examining stacks of U.S. dollars, receipts, and computer equipment while questioning a staff member. When asked about the nature of their operations, the employee maintained that they had merely conducted crypto exchange transactions.
The operation resulted in searches of additional offices and private residences, where authorities seized cash in various currencies, communication devices, and relevant documents. A suspected ringleader of the operation has been charged, and investigations are ongoing to identify potential accomplices. Officials emphasized that the main service provided by the exchange was enabling Russians to withdraw funds from outside the country, effectively using cryptocurrency as a remittance tool.
The crackdown comes amidst rising concerns about the use of cryptocurrency exchanges in Russia. Earlier reports indicated that numerous exchanges in Moscow were facilitating the transfer of stablecoins like Tether (USDT) to individuals in the UK. In May 2023, the Russian Central Bank noted a surge in transactions on crypto exchanges and peer-to-peer trading platforms, reflecting growing interest among citizens.
Currently, cryptocurrency exchanges lack legal status in Russia, but existing laws outline strict regulations on cross-border fiat currency transfers. Critics argue that many unofficial exchanges exploit these laws, masquerading as crypto investment services while facilitating illicit financial activities.
The recent police action underscores the ongoing tensions between regulatory authorities and the evolving landscape of cryptocurrency in Russia. As authorities continue to investigate and enforce compliance, the future of crypto exchanges in the country remains uncertain. This incident highlights the need for clearer regulations as the demand for cryptocurrency services persists among Russian citizens.
September 2024, Cryptoniteuae