Crypto Funds Raised By Pro-Russian Groups To Evade U.S. Sanctions

Table of contents

  1. Russia Subjected to Sanctions
  2. Russian-Connected Organizations
  3. Great Attention to Cryptocurrencies

According to a study report released Monday, pro-Russian organizations are raising funds in cryptocurrencies to support paramilitary activities and get over American sanctions as the war with Ukraine continues.

According to TRM Labs, a provider of digital asset compliance and risk management services, as of September 22, these fundraising organizations have accumulated $400,000 in cryptocurrencies since the invasion began on February 24. The study found that organizations are establishing choices for individuals to make donations used to finance military training at sites near the Ukrainian border and supply Russian-affiliated militia groups through the secure messaging application Telegram.

Task Force Rusich, which the U.S. Treasury described as a neo-Nazi paramilitary organization that has participated in the battle with Russia’s troops in Ukraine, is one of the organizations TRM Labs identified as raising money. Task Force Rusich has received approval from the Office of Foreign Assets Control (OFCA) of the Treasury Department.

Russia Subjected to Sanctions

Following its aggressive invasion of Ukraine earlier this year, Russia was subjected to a range of sanctions intended to isolate it from the world’s financial system. There were fears at the time that Russia would utilize cryptocurrencies to circumvent these sanctions. Experts disagreed, stating that amount of liquidity needed by Russia to shift money is not in the cryptocurrency system.

On the other hand, paramilitary organizations transfer money on a smaller scale, sufficient for the products they need to purchase.

Russian-Connected Organizations

Ari Redbord, head of legal and government affairs at TRM Labs, believes that these organizations use exchanges that rarely comply with anti-money laundering and other laws.

Redbord said that TRM Labs found the Russian-connected organizations using a mixture of publicly accessible wallet addresses, cross-checking with other websites, and online behavior. Nevertheless, he acknowledged that it was impossible to determine if these organizations were collaborating with the Russian government or supporting it.

Great Attention to Cryptocurrencies

The conflict between Russia and Ukraine has brought cryptocurrencies into the public eye. Digital currencies, which are delivered fast throughout the world, have been requested by Ukraine. However, Russian paramilitary organizations are now also employing them.

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