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>>Elliptic shows how Russian actors exploit cryptocurrency to bypass sanctions and evade financial restrictions.

Elliptic shows how Russian actors exploit cryptocurrency to bypass sanctions and evade financial restrictions.

crypthub

about 8 hours ago

Sanctions Evasion via Crypto Exchanges

Elliptic’s March 2025 report shows several crypto platforms—Bitpapa, ABCeX, Rapira, Aifory Pro—acting as hubs for sanctioned Russian entities to move funds outside traditional banks. The firms trace cross‑border transactions that mask origins and destinations, exploiting weaker KYC/AML controls on regional exchanges. While major venues like Binance and Coinbase enforce strict compliance, the fragmented ecosystem lets smaller exchanges fill a high‑risk niche.

Ruble‑Pegged Stablecoins as a loophole

The analysis highlights large flows through stablecoins pegged to the Russian ruble, creating a blockchain‑based parallel currency. Public ledgers reveal transfers, yet linking addresses to sanctioned actors requires advanced, often imperfect, analytics. These tokens operate from jurisdictions with ambiguous regulation, can be pooled in DeFi protocols, and thus evade traditional SWIFT and fiat blocks.

Regulatory and enforcement outlook

Experts warn that sanctions enforcement lags behind technological innovation, urging secondary sanctions on non‑compliant exchanges and tighter oversight of stablecoin issuers. Governments are expected to boost blockchain‑analytics capabilities and harmonize FATF standards globally. Closing the digital gap will be essential for future economic statecraft.