Crypto Storm Hits Russia: Garantex Suspends Services
In a sudden twist, Garantex, Russia’s largest cryptocurrency exchange, has stopped all its services. This happened after Tether, the company that makes the popular stablecoin USDT, froze a large amount of USDT on Garantex. This move has caused a lot of worry in the Russian crypto market, making people wonder about the future of digital money in the region. Let’s find out more about this story.
The Backstory: Sanctions and Controversies
Garantex has been in trouble for some time. In April 2022, the U.S. Treasury’s Office of Foreign Assets Control (OFAC) said Garantex was helping with illegal transactions, including ones linked to darknet markets and ransomware groups like Conti[1][3]. Even with these sanctions, Garantex kept working, serving Russian users through Russian banks that were also under sanctions[1].
Recently, the European Union added Garantex to its list of sanctions, saying it helped Russian banks that were already under EU sanctions and helped them avoid these sanctions[5]. This was the first time the EU directly sanctioned a Russian crypto exchange[3].
Tether Freezes USDT: A Big Blow
Tether’s decision to freeze over 2.5 billion rubles (about $28 million) worth of USDT on Garantex was like a punch in the gut for the exchange. This forced Garantex to stop all its services, including taking out cryptocurrency[3][5]. Garantex warned that this could put all Russian USDT at risk and set a bad example for other exchanges[1][3].
Garantex said it was trying to fix the problem, but Tether hasn’t said anything officially, which has left a lot of questions unanswered[3].
What This Means and What’s Next
The suspension of Garantex’s services shows how hard it is for crypto exchanges to work in places that are under sanctions. It also shows how important stablecoin issuers like Tether are in shaping the global crypto world. As rules get stricter, exchanges have to navigate complicated legal and political landscapes to stay in business.
This situation also raises bigger questions about how cryptocurrencies can be used to get around sanctions and how well current rules work. With the Russian Central Bank saying there’s more crypto activity, it’s important to have clear and strong rules[2].
Looking Ahead: A New Era for Crypto Rules
The Garantex story is a big moment in the relationship between cryptocurrencies and the people who make the rules. As we watch what happens next, one thing is clear: how governments and exchanges work together will shape the future of crypto.
In short, the suspension of Garantex’s services because of Tether’s actions is a wake-up call for the crypto world. It shows how important it is to have strong rules and for exchanges and governments to work together to keep the global crypto market safe and stable.
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Sources:
– crypto.news
– cryptoslate.com
– investing.com
