Russian Banks Are Evading Sanctions Through Huobi And KuCoin 14

Russian Banks Are Evading Sanctions Through Huobi And KuCoin

  • Huobi and KuCoin are reportedly processing transactions tied to sanctioned Russian banks. 
  • Customers are able to trade on the crypto exchanges using debit issued by the sanctioned banks. 
  • Tether is reportedly used by both exchanges to cater to the crypto needs of sanctioned Russian banks. 
  • Russian nationals are also using Binance to convert local currency into crypto without KYC checks. 

Banks in Russia are reportedly evading the sanctions imposed by the United States and the European Union following the invasion of Ukraine and the subsequent conflict that began exactly one year ago. Major crypto exchanges, including Huobi Global and KuCoin, have been identified as the platforms that are facilitating transactions tied to the sanctioned banks. 

Huobi and KuCoin may be in violation of US and European sanctions

Citing a report from digital asset data analytics firm Inca Digital. Bloomberg reported that Russian are using debit cards issued by sanctioned Russian banks like Sberbank to trade crypto on Huobi and KuCoin. Adam Zarazinski, the CEO of Inca Digital, stated in an interview that the actions of these crypto exchanges could be in violation of the sanctions imposed on Russia by multiple nations around the world. 

Tether is frequently used by Russians to move money out of the country. It is absolutely used by these two exchanges, in particular, to provide crypto banking services to sanctioned Russian banks.”

Adam Zarazinski, CEO of Inca Digital 

The report also mentioned Binance several times. The world’s largest crypto exchange is reportedly offering multiple methods to Russians to convert local currency into cryptocurrencies. This is being done through over-the-counter (OTC) trading and a peer-to-peer marketplace, both of which are available to Russians without know-your-customer (KYC) checks for up to $10,000. 

While Huobi, Tether, and KuCoin haven’t responded to the allegations, Binance’s global head of sanctions, Chargi Poyraz, said in a statement to Bloomberg that the exchange is a KYC-compliant platform, in addition to being the first major crypto exchange to implement European Union’s crypto-related sanctions on Russia. “Our P2P team takes the extraordinary added step of filtering any forms of communication between users to ensure there is absolutely no potential nexus with Russian entities through any sort of workaround,” Poyraz added.