Russia’s largest and sanctioned cryptocurrency exchange, Garantex, has suspended all of its operations following Tether’s decision to freeze over 2.5 billion rubles worth of USDT (approximately $28 million).
In a statement issued on March 6, Garantex informed its users via Telegram that it was temporarily halting all services, including cryptocurrency withdrawals, as it grapples with the freezing of its wallets. “Dear users! We have bad news,” the exchange stated. “Tether has waged war against the Russian crypto market and blocked our wallets for more than 2.5 billion rubles.” The exchange assured users that its team was working to resolve the issue and expressed determination, saying, “We are fighting and will not give up!”
Additionally, Garantex warned Russian users that all USDT held in Russian wallets is now at risk due to the freeze. As of now, Tether has not provided any public statement regarding the freeze.
The freeze comes amidst increasing scrutiny of Garantex’s operations, especially after its inclusion in the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) sanctions list in 2022. Garantex has been accused of facilitating illicit transactions, including those tied to darknet markets and ransomware operations. Despite being blacklisted by the U.S., the exchange continued to operate, serving Russian users through sanctioned Russian banks.
This latest development follows the European Union’s recent decision to add Garantex to its sanctions list, further tightening the financial restrictions on the exchange as part of a broader effort to cut off Russian-linked financial networks.
Tether, which has been under scrutiny for its dealings with Russian-linked entities, has yet to publicly comment on the freeze. The move signals an escalation in the ongoing regulatory crackdown on cryptocurrency exchanges operating in or associated with Russia, amid heightened geopolitical tensions.
Garantex, which was blacklisted by the U.S. Treasury’s OFAC in April 2022, had previously been linked to facilitating transactions for illicit actors, including funds related to the Conti ransomware group and the now-defunct Hydra marketplace.
As the situation unfolds, the broader impact on the Russian crypto market remains uncertain, but the Garantex shutdown represents a significant development in the ongoing clash between cryptocurrency exchanges and global regulatory bodies.
