Russian Companies Use Cryptocurrency to Purchase Sanctioned Equipment – WSJ.

Russian Companies Use Cryptocurrency to Evade Sanctions

Russian companies are finding ways to circumvent sanctions by using cryptocurrency, specifically the Tether token. This method is particularly used when purchasing high-tech equipment, such as components for drones, reports The Wall Street Journal.

According to sources, smuggler Andrei Zverev used Tether to pay for goods from China for the company "Kalashnikov", the largest manufacturer of firearms in Russia. Specifically, the company was purchasing electronic parts for drones, which were under U.S. and EU sanctions.

The use of Tether has become a popular method of payment on the black market due to its ability to bypass government controls and ensure transaction anonymity.

Zverev used Tether to transfer millions of dollars for "Kalashnikov" to an electronics distributor in Hong Kong and transported goods through Central Asian countries to avoid customs controls.

"Russia is increasingly turning to alternative payment mechanisms to bypass U.S. sanctions and continue funding the war against Ukraine," said Deputy Treasury Secretary for Terrorism and Financial Intelligence Brian Nelson.

Additionally, the Russian cryptocurrency exchange Garantex also plays a significant role in bypassing sanctions, allowing users to convert rubles into Tether.

The U.S. Treasury Department is proposing legislation that would allow the blocking of transactions using stablecoins, such as Tether, which are denominated in U.S. dollars.

Recently, the Treasury Department added a Moscow-based company that cooperated with a sanctioned Russian bank to the blacklist, aiming to prohibit it from making Tether payments.

Source: Economic Truth