- Garantex has suspended operations after Tether froze over 2.5 billion rubles ($27 million) in USDT.
- The EU sanctioned the exchange in February and by the U.S. in 2022 for processing illegal transactions and violating anti-money laundering laws.
Garantex has stopped its operations after Tether blocked almost 2.5 billion rubles’ worth of USDT. Russia’s biggest sanctioned crypto exchange, Garantex, has currently stopped all transactional services after Tether blocked over 2.5 billion rubles in USDT. The popular stablecoin provider, Tether, blocked the exchange access to $27 million USD.
Garantex Confirms Blocked Funds and Halted Operations
On the 6th of March, the exchange shared information regarding the frozen funds on their official telegram group informing users of the situation and stating that Tether had taken action against the country’s digital asset market by freezing it’s wallets.
And as a result of that, withdrawals and other transactions are on hold while the team tries to fix the problem. Despite this, Garantex assured users that they remain determined to overcome the challenge. The exchange also told Russian users that their USDT might not be safe.
As of time of writing, Tether has not said anything about this yet. But in the past, people have questioned Tether’s dealings with Russian-linked groups.
Grantex Other Sanctions
On Feb 26h, The European Union added Garantex to its 16th round of sanctions against Russia. This action follows previous measures by the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC), which sanctioned Garantex in April 2022.
The exchange faced penalties for processing illegal transactions and failing to follow anti-money laundering (AML) and counter-terrorism financing (CFT) laws. These violations raised concerns among regulators, leading to strict actions against the platform.
The Investigations done has shown that over $100 million worth of transactions on Garantex were connected to criminal organizations and illegal online markets. The U.S. Treasury specifically mentioned the exchange’s involvement in handling funds linked to the Russian Ransomware-as-a-Service group Conti and the now-defunct Hydra marketplace.
Currently, the officials in the United States and the United Kingdom, are looking into over $20 billion in USDT transactions that was processed through Garantex. If confirmed, this could be one of the biggest violations of economic sanctions against Russia since the conflict in Ukraine began.
However, authorities have stated that these inquiries are still ongoing, and no final decision has been made regarding Tether’s involvement in any wrongdoing.
Tether’s decision to freeze funds on Garantex shows its commitment to working with law enforcement to stop illegal activities. By blocking access to these assets, the company is demonstrating its willingness to support global regulatory efforts.
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