Andrei Zvereva self-proclaimed Russian smuggler, used Bind USDT/USDa popular cryptocurrency, to facilitate transactions for the purchase of high-tech equipment and weapons parts, helping Russian companies circumvent Western sanctions.
What happened: Zverev, a middleman for Russian companies, used Tether to facilitate transactions to purchase high-tech equipment and weapons parts, the Wall Street Journal reported. In one case, Zverev used Tether to transfer millions of dollars Kalashnikov concernRussia’s largest small arms manufacturer, to a Hong Kong electronics distributor.
Zverev wrote in a Telegram chat and uses Tether to convert rubles into cryptocurrency and pay foreign suppliers in countries such as China and the Middle East. This has allowed Russian companies to continue their trade despite Western sanctions.
See also: Edward Snowden Says SEC Will ‘Lose’ Lawsuit Against Coinbase, Ethereum Co-Founder Thinks Metaverse Is ‘Ill-defined’ & More: Weekly Cryptocurrency Roundup
The US Treasury Department has been pushing for legislation that would allow it to block transactions in US dollar-denominated stablecoins like Tether. The department recently blacklisted a Moscow company that used Tether-based payments.
“Russia is increasingly turning to alternative payment mechanisms to circumvent US sanctions and continue to finance its war against Ukraine,” Brian NelsonThis was stated in a note by the Undersecretary of the Treasury for Terrorism and Financial Intelligence.
Because matter: The use of cryptocurrencies to evade sanctions and finance illicit activities is nothing new. North Korea, for example, has stolen billions in cryptocurrencies to finance its doomsday weapons. In response, the United Nations called for stricter regulations on cryptocurrency transactions.
On the other hand, Russia is moving to establish itself as a major player in the global cryptocurrency market. The country has announced plans to create a new global currency, create specialized institutions for mining and facilitate cross-border cryptocurrency transactions.
However, the use of cryptocurrencies for illicit activities has also raised concerns. Co-creator of Ethereum Vitalik Buterin proposed using “privacy pools” to improve the transparency and reliability of the cryptocurrency market and eliminate unscrupulous cryptocurrency traders.
Read next: Dogecoin jumps 15% ahead of Doge Day, Whale transactions on the rise
Image via Shutterstock
Designed by Benzinga NeuroBy
Kaustubh Bagalkote
The GPT-4-based Benzinga Neuro content generation system leverages Benzinga’s extensive ecosystem, including native data, APIs, and more to create rich, timely stories for you. Learn more.