Russia Follows US Lead in Cryptex Crypto Exchange Probe, 100+ Arrested

Key Takeaways

• Russia has arrested over 100 suspects linked to the Cryptex.
• U.S. authorities sanctioned and seized millions from the Cryptex crypto exchange last week.
• This is one of the rare instances when Russia is investigating a US-sanctioned Russian platform.

Russia has launched a sweeping investigation into Cryptex, a cryptocurrency exchange, and its affiliated Universal Anonymous Payment System (UAPS), just days after Washington slapped sanctions on the platform and its Russian founder, Sergey Sergeevich Ivanov, over suspected money laundering activities.

The coordinated crackdown has resulted in several arrests and millions seized.

100 Arrested and $16M Seized

The raids, which spanned 148 locations across Russia, targeted suspected Cryptex operatives and affiliates.

Moscow law enforcement netted  hundreds of suspects who now face a litany of charges, including participating in a criminal organization, unauthorized computer access, and unlawful banking operations.

If convicted, the accused could face up to 20 years behind bars.

The operation also seized nearly $16 million in crypto assets.

Cryptex, which has been operational since 2013, allegedly enabled the laundering of astronomical sums, including an estimated 112 billion rubles ($1.2 billion) in 2023 alone.

The platform’s organizers allegedly provided bank cards and online access to facilitate transactions, effectively creating a shadow financial system catering to ransomware actors, darknet vendors, and other criminal entities.

The platform’s anonymity features, once touted as a hallmark of its Universal Anonymous Payment System (UAPS), ultimately proved its undoing, as authorities were able to trace and dismantle the network.

Russia’s Tough Stance a Sign of Changing Times?

Russia’s shift in crypto regulation may signal a new era of cooperation with the West.

Just months after greenlighting crypto use and mining in August, the country is taking a hardline stance against cybercriminals, subtly aligning with U.S. efforts to rein in crime.

As regulators work to codify comprehensive crypto laws, the crackdown on Cryptex, a platform sanctioned by the U.S., suggests Moscow is willing to confront its own shadowy elements.

This marks a departure from the norm, as Russian authorities have historically been reluctant to pursue U.S.-sanctioned individuals.

The Cryptex arrests, coupled with recent raids on illegal crypto platforms in the country, convey a zero-tolerance message to the public: the Kremlin is tired of being a haven for cybercriminals.

This shift in posture could have far-reaching implications, potentially reshaping the country’s approach to financial regulation in the digital age.