How Russia Exploits Kyrgyzstan’s Crypto Market to Dodge Sanctions – The Untold Story
Sanction evasion goes digital—and Russia's playing the long game.
Kyrgyzstan’s unregulated crypto market has become Moscow’s financial lifeline, with rubles flowing into shadowy exchanges faster than regulators can say 'AML compliance.'
Here’s how the scheme works:
1. Rubles to Tether: Russian entities convert fiat to stablecoins via Kyrgyz middlemen—no SWIFT, no problem.
2. Offshore Obfuscation: Funds bounce through shell companies in Bishkek before exiting as 'clean' crypto.
3. Western Blindspot: The lack of KYC enforcement makes Kyrgyz exchanges the perfect dark pool for sanctioned cash.
Meanwhile, Wall Street still thinks CBDCs are the real threat—classic finance-sector myopia.
The takeaway? When superpowers play sanctions chess, crypto becomes the ultimate pawn. And Kyrgyzstan? Just another board on the geopolitical table.
Kyrgyz crypto exchanges under scrutiny
TRM Labs’ report points to crypto exchanges Grinex and Meer, which sprang up in Kyrgyzstan shortly after U.S.law enforcement disrupted Russia’s Garantex in March 2025.
On-chain analysis suggests both firms, suspected to be successors, used similar wallet infrastructure and transaction patterns as Garantex, helping Russian users MOVE funds through A7A5, a Russian ruble-tied stablecoin that has long come under scrutiny.
Crypto.news reported earlier in June that an FT research revealed that the A7A5 stablecoin has quietly moved billions since launch, and has ties to sanctioned entities that suggest it may be part of broader efforts to bypass Western sanctions and enable cross-border payments for Russian entities.
Another exchange, Envoys Vision Digital Exchange (EVDE), was found to have ties to wallets linked to the Rusich Group, a sanctioned Russian paramilitary organization. Many of these platforms also display signs of being shell companies, including identical registration addresses, shared founders, and recycled contact information, suggesting coordinated or shared illicit control.
Why Kyrgyzstan must tighten controls
TRM Labs warns that while Kyrgyzstan may be exploited rather than complicit, weak oversight leaves the door wide open.
Without tighter controls on VASP registrations, clearer ownership rules, and stronger checks on shell companies, Russia’s financial networks will keep exploiting the country’s crypto infrastructure.
If left unaddressed, similar tactics could also spread to neighboring Kazakhstan and Uzbekistan, which are already rolling out crypto-friendly regulations, undermining international sanctions.
