Tether freezes $27 million worth of USDT on the Russian crypto exchange Garantex

Stablecoin operator Tether has revealed that it has frozen $27 million in USDT on the sanctioned Russian crypto exchange, Garantex. The cryptocurrency exchange has also suspended all its trading and withdrawal services.

The U.S., through the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC), was the first to announce sanctions against Garantex in April 2022. OFAC revealed that the majority of Garantex’s operations were carried out at Federation Tower and Saint Petersburg, Russia, where other sanctioned digital asset exchanges had also operated.

Garantex confirms freezing of $27M in USDT and service suspension

There is an ongoing incident with Tether freezing the whole USDT stack of the Russian exchange Garantex. Reports range from 27 to 200million USDT.

Tether has entered the war against Russia.

— William J. Jones (@W_J_Jones) March 6, 2025

Garantex wrote on its official announcement channel on Telegram on March 6 that Tether had entered the war against the exchange. The Russian crypto market revealed that the stablecoin issuer had blocked its wallets worth more than 2.5 billion rubles ($27 million).

The Russian crypto company acknowledged it had temporarily suspended all trading and withdrawal services, with its website currently under maintenance. The firm also warned its customers that all USDT in Russian wallets was currently under threat.

Local lawmakers have argued that Tether’s USDT freeze had significant implications for the Russian crypto space despite it not being a massive event for the broader crypto market.

Anton Gorelkin, deputy head of the Russian parliament’s committee on information policy, highlighted in his Telegram channel on Thursday that the freeze was “for sure not the last case when Western countries put pressure” on the crypto ecosystem. Gorelkin also argued that “it should be recognized that it is impossible to completely block this market for Russia.”

Tether’s freeze on the Russian exchange added to the company’s dedication to cooperating with law enforcement agencies to combat criminal activity. The stablecoin issuer has had a similar incident in the past, assisting U.S. authorities, including the Department of Justice (DOJ) and FBI, in seizing $1.4M USDT from a tech support scam network.

Garantex adds to its list of sanctions over the years

The Council of the European Union added the Russian centralized exchange to their latest sanctions package last week. The EU sanctioned the firm on February 26 as part of the 16th package of sanctions on “Russia’s war of aggression against Ukraine.” The council also argued that Garantex was “closely associated with EU-sanctioned Russian banks,” marking the EU’s first time sanctioning a crypto exchange. The EU stated that “for the first time, the council also decided to sanction a cryptocurrency exchange based in Russia, Garantex.”

“This package continues targeting actors responsible for circumventing EU sanctions, including through third countries.”

– European Union announcement

The firm also lost its Estonian license following an investigation by the Estonian Financial Intelligence Unit. The U.S. Treasury also linked the firm to transactions tied to the Russian Ransomware-as-a-Service group Conti and the now-defunct Hydra marketplace.

Garantex received more sanctions from the U.S. and UK in response to the Russian invasion of Ukraine in 2024. Both countries are currently investigating over $20 billion in USDT transactions processed through the virtual assets exchange. 

The digital asset transactions marked one of the largest breaches of sanctions imposed on Russia since the Ukraine conflict commenced. Authorities have acknowledged that the investigations were still ongoing, and no conclusions about Tether’s involvement were reached at publication time. The Russian crypto exchange said in a statement to ICIJ in 2024 that it plans to prevent the use of the exchange for illicit activities and actively cooperate with EU and U.S. authorities.

The Russian exchange was also sanctioned by the U.S. in 2022 for facilitating illicit transactions, anti-money laundering, and the counter-financing of terrorism deficiencies. The sanction came after an investigation by Eesti Ekspress and the International Consortium of Investigative Journalists revealed that a company with connections to Garantex co-owned a debt-collection business with a convicted gang leader and has ties to Rosneft, the Kremlin-tied oil firm. 

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