Tether, a well-known stablecoin issuer, has frozen $27 million USDT, which is approximately 2.5 billion rubles, on the Russian-sanctioned cryptocurrency exchange Garantex. All the operations on the platform have been suspended completely.
Garantex Confirms Freeze and Service Suspension
Garantex announced on Telegram that Tether has frozen the exchange’s funds, amounting to 2.5 billion rubles. Moreover, its main operations such as withdrawals and other transaction related services have also been temporarily halted.
The platform’s website is also under maintenance and the Russian exchange has warned the users that “all USDT in Russian wallets are currently under threat”.
Sanctions and Regulatory Scrutiny
The EU included Garantex in its 16th package of sanctions against Russia on February 26. The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) had already sanctioned Garantex in April 2022 for carrying out illegal transactions and for failing to comply with anti-money laundering (AML) and countering the financing of terrorism (CFT) regulations.
Reports indicated that over $100 million in transactions on the platform were linked to bad actors and darknet markets.
The U.S. Treasury cited its role in processing transactions tied to the Russian Ransomware-as-a-Service group Conti and the now-defunct Hydra marketplace.
Investigations into Potential Sanctions Breaches
The U.S. and the U.K. are currently investigating over $20 billion in USDT transactions processed through Garantex. These transactions could represent one of the largest breaches of sanctions imposed on Russia since the Ukraine conflict began.
However, officials have clarified that the investigations are ongoing, and no conclusions about Tether’s involvement have been reached yet.
This move by Tether implies company’s dedication for cooperating with law enforcement agencies to combat criminal activity. Tether has also played a role in assisting U.S. authorities, including the Department of Justice (DOJ) and FBI, in seizing $1.4 million USDT from a tech support scam network.
Also Read: FTX Creditor Repayment Update: Next Distribution Set for May 30 By Kraken
