Garantex Sanctions: How Russian Crypto Traders Are Affected

When the U.S. Treasury’s Office of Foreign Assets Control (OFAC the agency that administers and enforces economic and trade sanctions) slapped Garantex sanctions on the Moscow‑based exchange, the ripple effect hit every Russian crypto trader who relied on the platform to move money abroad.

Key Takeaways

• OFAC’s 2025 redesignation targets Garantex’s role in ransomware and darknet finance.
• Traders now face higher fees, longer verification times, and a fragmented ecosystem of successor platforms.
• Typical money‑flow routes involve multiple jurisdictions, making compliance and risk assessment more complex.
• Understanding the new process - from ruble deposits to USDT withdrawals - helps traders avoid legal pitfalls.
• Future sanctions are likely to tighten, pushing the ecosystem toward even more decentralized, hard‑to‑track structures.

What the Sanctions Targeted

The original sanction on April52022 cited Executive Order14024, which bars entities that support Russia’s financial services sector. In August2025, the Treasury issued a redesignation under Executive Order13694 (amended by E.O.14144 and14306). The notice accused the exchange of processing over $100million in transactions linked to illicit actors since 2019 and directly facilitating ransomware groups.

How Garantex Was Built to Evade Sanctions

Technical analyses by Transparency International Russia reveal a layered system designed to hide money trails. The core exchange (Garantex a Russian cryptocurrency exchange founded in 2019) originally operated through Estonia but moved most operations to Moscow and Saint‑Peterburg. After the 2025 crackdown, the platform split into four main successors:

• Grinex a re‑branded exchange created by former Garantex staff
• Exved a cross‑border payment processor that channels funds into dual‑use goods
• MKAN Coin a Telegram‑based crypto marketplace headquartered in Dubai
• Feilian Company Limited a Hong‑Kong entity that acts as a ruble‑to‑USDT conversion hub

These entities weave together a multi‑step flow that spans the UAE, Brazil, Kyrgyzstan, Spain, Thailand, Georgia, HongKong, and Russia.

Typical Money‑Flow for a Russian Trader

Below is the most common route documented by investigators:

1. Trader deposits rubles into a personal account at Alfa‑Bank one of Russia’s largest private banks.
2. Funds are transferred to Feilian Company Limited in HongKong, which holds a foreign‑exchange account.
3. Feilian converts rubles to USDT (or yuan/dollars) and routes the stablecoin through Exved or directly to a partner exchange such as Grinex.
4. The trader withdraws USDT to an overseas wallet, often for buying dual‑use goods or paying overseas invoices.

The whole chain can take 2-3weeks for verification, and fees have jumped from 0.1% to as high as 1.5% after law‑enforcement pressure.

Impact on Russian Crypto Traders

Below are the concrete ways traders feel the pressure:

• Higher Transaction Fees: Community forums report a 15‑fold increase, especially for USDT exits.
• Longer Onboarding: Verification now involves multiple KYC layers across jurisdictions, stretching from a few days to over a month.
• Reduced Liquidity: Many offshore wallets have frozen balances due to secondary sanctions.
• Legal Uncertainty: Using any of the successor platforms can expose users to secondary sanctions from the U.S. or EU.
• Operational Complexity: Traders must coordinate with intermediaries on Telegram bots, which often provide minimal support.

Comparison of Garantex and Its Successor Platforms

Risk Management Checklist for Traders

• Verify the current sanction list for each platform before transacting.
• Document every step of the ruble‑to‑USDT conversion, including intermediary IDs.
• Maintain a separate, low‑risk wallet for outbound funds; avoid keeping large balances on any single platform.
• Stay updated on guidance from the FBI U.S. Federal Bureau of Investigation, which tracks crypto‑related crime and the Treasury’s Office of Foreign Assets Control.
• Consider using privacy‑preserving tools (e.g., mixers that comply with local law) only after consulting a legal advisor.

Future Outlook: What’s Next?

Analysts from Chainalysis predict that the sanctions‑evasion model will keep evolving. The Treasury plans to expand secondary sanctions to cover intermediaries like Feilian Company Limited and any crypto‑friendly banks that facilitate the ruble‑to‑USDT bridge. At the same time, new decentralized finance (DeFi) protocols could provide alternative pathways that are harder for regulators to trace.

For traders, the key will be agility: staying informed about jurisdictional changes, diversifying exit routes, and keeping compliance documentation airtight. The cat‑and‑mouse game is unlikely to end soon, but a proactive risk posture can mitigate the most severe financial and legal consequences.