Cryptocurrency helps Russia circumvent Western sanctions and buy weapons

Andrei Zverev, a self-proclaimed Russian smuggler, uses Tether (USDT) to facilitate transactions for the purchase of high-tech equipment and weapons parts. In this way, the criminal helps Russian companies circumvent Western sanctions, Benzinga writes with reference to The Wall Street Journal.

In one case, Zverev used Tether to transfer millions of dollars from Kalashnikov, Russia’s largest small arms manufacturer, to an electronics distributor in Hong Kong. Zverev chatted on Telegram and used Tether to convert rubles into cryptocurrency and pay foreign suppliers in China and the Middle East. This allowed Russian companies to continue trading despite Western sanctions.

The U.S. Treasury Department is pushing for a law that would allow blocking transactions in U.S. dollar-denominated stablecoins like Tether. The agency recently blacklisted a Moscow-based company that used Tether-based payments.

«Russia is increasingly turning to alternative payment mechanisms to circumvent U.S. sanctions and continue to fund its war against Ukraine,» said Brian Nelson, U.S. Treasury Under Secretary for Terrorism and Financial Intelligence.

The use of cryptocurrencies to avoid sanctions and finance illegal activities is nothing new. North Korea, for example, has stolen billions in cryptocurrencies to fund doomsday weapons. In response, the UN is calling for stricter regulation of cryptocurrency transactions.

On the other hand, the terrorist state Russian Federation is trying to establish itself as a major player in the global cryptocurrency market. The aggressor country has announced plans to create a new global currency, establish specialized mining institutions, and facilitate cross-border cryptocurrency transactions.

However, the use of cryptocurrencies for illegal activities also raises concerns among the developers of digital assets themselves. Thus, Ethereum co-founder Бутерін" href="https://noworries.news/biography/vitalij-buterin/" data-bio-id="3642">Vitalik Buterin proposed to use «privacy pools» to increase the transparency and reliability of the cryptocurrency market and weed out unscrupulous crypto traders.