The World Beyond SWIFT: Russia and the Cryptocurrency Underground Economy

Article Author: Anita

Winter mornings in Moscow always arrive slowly. The subway glides from the gray residential areas into the city center, and as usual, the advertising screens inside the carriages scroll through ads for Ruble loans, online shopping promotions, and a banner that looks quite ordinary: "Settling Overseas Income? USDT Accepted Here." It's hard to imagine that in a country surrounded by the Western financial system, the term "stablecoin," which originally only appeared in Silicon Valley whitepapers, has quietly become the infrastructure on which ordinary people and businesses rely.

Alexey (pseudonym), 34 years old, claims to "work in IT consulting," but his true identity is a small node in Moscow's stablecoin black market chain. At nine in the morning, his work begins with checking Telegram channels. He has four or five groups on his phone, such as "Moscow USDT Circle Rate," "Freelancer Settlement Channel," and "Ruble Cash Exchange / Card Transfer - Limited to Acquaintances Only."

Each group has bots offering deals - "Buy USDT at 76.3, Sell at 77.1." Deeper down, there are dozens of private chat windows: young people doing freelance development work who need to convert customer-received dollars from an external card to USDT and then to Rubles; small companies importing small parts that need to pay Turkish suppliers in USDT; and mysterious numbers with accents who only say: "Large amount, meet offline."

Alexey's way of making a profit is simple: earning a small price difference through small transactions or, on large orders, taking a fraction of a percent as a "fee," and behind the scenes, connecting to larger exchangers or trading platforms.

All of this may appear to be just "currency exchange," but the funds quickly flow into deeper underground currents.

Some people deposit USDT into local exchanges with Russian-friendly interfaces and then convert it into Bitcoin to transfer out; some launder funds into offshore accounts through Russian platforms like Garantex; and others use USDT to provide liquidity to companies in Georgia or the UAE.

By evening, he will split the USDT he earned that day into two parts: one part will be sold for Rubles to pay the mortgage and buy groceries, and the other part will quietly rest in a multi-signature wallet, waiting for the day when the situation changes again, perhaps serving as the final safety net at home.

On the balance sheet, he is just a small part of the "Russian Retail Crypto Inflow."

But the line connecting all these dots is the invisible market.

I. After Being Cut Off, New Underground Veins Grow

Russia's crypto story did not start after the sanctions.

In 2020, Eastern Europe was already one of the world's "highest regions for cryptocurrency-related crime." Chainalysis research shows that the darknet received a record $1.7 billion in cryptocurrency that year, with most of it flowing to one name: Hydra. Hydra is the largest darknet market to date, with its peak revenue accounting for 75% of the global darknet market.

Before being shut down by the German police in April 2022, it was actually a vast "dark economic center" — drugs, counterfeit documents, money laundering services, biometric data, all "transactions not recognized by the official world," settled in stablecoins.

The downfall of Hydra did not make this chain disappear, it just made the shadow redistribute: its users, infrastructure, intermediary networks, later recombined among Garantex, Telegram OTC, and small trading platforms.

The dark side of the Russian crypto economy did not emerge after the sanctions; it has a deep historical foundation.

Since the outbreak of the 2022 Russo-Ukrainian War and the comprehensive escalation of sanctions, Russia has been encircled on all sides in the traditional financial world: foreign exchange reserves frozen, major banks excluded from SWIFT, Visa and Mastercard collectively withdrawn. For a country whose lifeblood is energy and commodity exports, this is almost equivalent to being strangled.

But the digital realm tells another story:

According to Chainalysis' statistics on European crypto activity from July 2024 to June 2025, during this period, Russia received cryptocurrency assets worth $376.3 billion, ranking first in Europe, far surpassing the $273.2 billion of the UK. (Source)

In Bitcoin mining, Russia is no longer a hidden player. According to the latest estimates from the Hashrate Index data platform, by the end of 2024, Russia accounted for approximately 16% of the global Bitcoin hashrate — second only to the United States. (Source)

These two stark figures are enough to illustrate:

As the world tries to push Russia out of the traditional financial system, a new, underground crypto economy is growing rapidly.

If OTC traders like Alexey are considered capillaries, then local trading platforms like Garantex are the heart of the black market.

Garantex was originally registered in Estonia, but its business focus has always been in Moscow. Starting in 2022, it has been successively included in sanction lists by the U.S. Department of the Treasury and the European Union, accused of facilitating ransomware, dark web transactions, and providing services to sanctioned banks.

In theory, such a platform should have long been "dead." However, in September 2025, a report released by the International Consortium of Investigative Journalists (ICIJ) revealed that despite multiple crackdowns, Garantex was actually "continuing to operate in the shadows," providing cryptocurrency exchange and transfer services to Russian and surrounding region clients through a series of offshore companies, mirror sites, and proxy accounts.

More remarkably, a deep dive report by blockchain analytics firm TRM Labs indicated that in 2025, Garantex and the Iranian exchange platform Nobitex together accounted for over 85% of inbound cryptocurrency funds flowing into sanctioned entities and jurisdictions.

In March 2025, Tether froze a USDT wallet related to Garantex worth about $280,000 (approximately 25 billion rubles), forcing the exchange to announce a suspension of its operations. However, a few months later, the U.S. Department of the Treasury sanctioned a new name: Grinex — "a cryptocurrency exchange platform created by Garantex employees to assist in evading sanctions."

The black heart received a blow but continued to beat in a new form.

II. A7A5: The Ambition and Paradox of "Ruble On-chain"

USDT is currently the protagonist of Russia's shadow economy, but in the eyes of Moscow officials, it has a fatal flaw — it is too "American" and too "centralized."

In 2025, a new player quietly entered the scene: A7A5, a stablecoin issued by a Kyrgyzstan platform, claiming to be "linked to the ruble."

The Financial Times revealed in an investigation that within four months, A7A5 completed approximately $60-80 billion worth of transactions, mostly occurring on weekdays and concentrated during Moscow trading hours, with the custodian bank being Russia's sanctioned Promsvyazbank.

The EU and UK's sanction documents straightforwardly described it as a "tool for Russia to evade sanctions." By October 2025, the EU officially added A7A5 to the sanction list, and blockchain analysis firms also pointed out its close coupling with Garantex and Grinex, becoming a new central node in Russia's cryptocurrency settlement network.

The role played by A7A5 is very subtle:

1. For Russian enterprises, it is a "Ruble stablecoin that can bypass USDT risks";

2. For regulators, it is a "tool to put the Ruble on the blockchain and bypass bank scrutiny."

Behind this is an increasingly clear idea in Russia: "Since we cannot do without stablecoins, at least some of it should be issued by us."

The paradox is that any stablecoin that aims to go global must rely on infrastructure that Russia cannot control: public blockchains, cross-border nodes, overseas exchanges, and the financial systems of third countries.

A7A5 aims to be a "sovereign stablecoin," yet it must circulate in a world that Russia does not fully control. This is a microcosm of Russia's entire crypto strategy—wanting to break free from Western finance while still having to use the Western-built "blockchain financial building blocks."

III. What Does Crypto Mean for Russia? Not the Future, But the Present

The Western world often sees crypto as an asset, a technology, or even a culture. But in Russia, it plays a completely different role:

1. For Businesses: Crypto is an Alternative Channel for Trade Settlements

Russian businesses import high-tech parts, drone components, industrial machinery, and even consumer goods that cannot be paid for through the traditional banking system. This has led to a quiet but stable route: Russian enterprises export to intermediaries in the Middle East/Central Asia, then use USDT/USDC to transact with suppliers, and finally convert back to Rubles over-the-counter in Moscow.

It is not sophisticated, romantic, or "decentralized," but it is functional, dynamic, and alive.

Here, crypto is not a dream but the least efficient yet the only practical realism.

2. For the Youth, Crypto is an Exit from the Ruble

The Russian banking system has long suffered from a lack of trust, and the Ruble's years of weakness have made crypto the most natural asset haven for the middle class and young engineers.

If you randomly ask a software engineer in Moscow, they might not tell you "I trade coins," but rather "I convert my salary to USDT and keep it with a trusted OTC team on Telegram. The bank may freeze my card, but the chain won't freeze me."

This statement is a microcosm of contemporary Russia.

3. For the Nation, Crypto and Mining are a "Digital Energy Export"

Russia has some of the cheapest electricity in the world—Siberian hydropower and excess natural gas have turned into a Bitcoin mining paradise.

Mining provides: an "export product" outside the banking system, a globally exchangeable digital commodity, a way to circumvent financial blockades

The Russian Ministry of Finance has officially acknowledged multiple times that "mining revenue is an essential part of the national trade system."

This is no longer just a grassroots activity but rather a quasi-state economic sector.

4. On the Grey System: Cryptography as an Invisible Lubricant

This part is hard to quantify, but existing facts include European intelligence agencies pointing to Russian intelligence agencies using cryptography for information warfare, hacker operation payments, large-scale underground fund movement between Europe and Russia via stablecoins, and various smuggling networks highly relying on on-chain fund pathways.

Is Russia a "Crypto Nation"?

The answer is more complex than imagined. If you measure by technological innovation, it's not. If you look at VC projects and DeFi, it's also not. If you measure by mining, on-chain transaction volume, stablecoin inflows, and trade settlement reliance, it is a global crypto force to be reckoned with.

It did not "voluntarily become" but rather "was pushed by the world to become."

This article is contributed content and does not represent the views of BlockBeats.