Russian cryptocurrency exchange Garantex announced on Thursday that stablecoin Tether had blocked digital wallets on its platform, which collectively held over 2.5 billion roubles ($28 million). This move has forced Garantex to suspend operations just days after being sanctioned by the European Union.
The EU included Garantex in its 16th sanctions package on February 24, accusing the platform of being closely linked to Russian banks already under EU sanctions and playing a role in circumventing these sanctions. In a statement on Telegram, Garantex expressed frustration, stating, “We have bad news. Tether has entered the war against the Russian crypto market.”
When contacted for comment, a spokesperson for Tether referred Reuters to the U.S. Secret Service, offering no additional details on the matter.
Garantex confirmed it was halting all services, including cryptocurrency withdrawals, and vowed to continue fighting against the sanctions. “Please note that all USDT held in Russian wallets is now under threat,” the exchange warned.
As access to the U.S. dollar and the SWIFT global payment network has been restricted, many Russians have turned to cryptocurrencies to bypass these financial limitations, with the central bank permitting businesses to use cryptocurrencies for international trade.
The U.S. had previously labeled Garantex as a “ransomware-enabling virtual currency exchange” when imposing sanctions on the platform in April 2022, accusing it of facilitating illicit activities.
Russian lawmaker Anton Gorelkin responded to the latest sanctions, accusing Western nations of pursuing political motives. He assured that this would not be the last attempt to target Russia’s cryptocurrency infrastructure but stressed that cryptocurrencies remain a key tool for circumventing sanctions, despite Tether’s actions.
