When the U.S. Treasury slapped sanctions on Garantex in April 2022, most thought it was the end of the road for one of Russia’s biggest crypto exchanges. But by August 2025, after another wave of sanctions targeting its role in laundering over $100 million in cybercrime funds, it became clear: Garantex wasn’t shutting down. It was evolving.
Sanctions Didn’t Kill Garantex - They Made It More Invisible
Garantex Europe OU, originally registered in Estonia but run out of Moscow and Saint Petersburg, was never just another crypto exchange. By 2025, it had become a central hub for Russian traders trying to move money out of the country without triggering bank flags. The U.S. Treasury accused it of processing payments for ransomware gangs and darknet markets. Treasury Secretary Janet Yellen called it a direct enabler of cybercriminals. But instead of disappearing, Garantex fragmented. Its operators didn’t shut down. They rebuilt. New platforms like Grinex, Exved, and MKAN Coin popped up, each handling parts of the old system. Grinex took over trading. Exved moved money between Russia and overseas exporters. MKAN Coin, running on Telegram from Dubai, let users swap rubles for USDT without touching a traditional bank. The core function stayed the same: get crypto out of Russia, quietly.How Russian Traders Are Still Using It
For Russian crypto users, the process is now a multi-step puzzle. It starts with sending rubles to a Hong Kong-based shell company called Feilian Company Limited, which has an account at Russia’s Alfa-Bank. That company then converts the rubles into dollars, yuan, or USDT and sends them out through foreign accounts in places like the UAE, Brazil, or Georgia. The whole chain hides the crypto trail from Russian banks - and from Western regulators. One trader on a Russian Telegram channel said in August 2025: "Even after sanctions, I can still convert rubles to USDT and send them abroad in 24 hours without my Russian bank flagging anything." That’s the goal. No paper trail. No bank alerts. Just crypto moving in the shadows. But it’s not easy anymore. New users now need 3 to 4 weeks of guidance from Telegram groups to figure out the process. Before the sanctions, it took 1 to 2 weeks. Support channels are gone. No live chat. No email help. Just bots and forum posts from other users who’ve been through it.Fees Have Skyrocketed
The cost of using these services has jumped. Before 2025, transaction fees on Garantex hovered around 0.1%. After the FBI and international law enforcement cracked down in March 2025 - seizing servers, freezing $26 million in crypto, and taking down three domains - fees jumped to 1.5% or higher. That’s a 15x increase. Traders on the Russian forum BitBrothers complained that the higher fees eat into profits, especially for small-scale traders. But they still use it. Why? Because there’s no better alternative. Russian banks block international crypto transfers. Western exchanges like Binance and Coinbase ban Russian IPs. Garantex’s network is one of the few that still works.
The Bigger Picture: Russia’s Sanctions-Evasion Ecosystem
Garantex isn’t alone. It’s part of a much larger system. The Treasury sanctioned six other companies tied to it: A7, A71, A7 Agent, Old Vector, InDeFi Bank, and Exved. Together, they form a web that moves an estimated $300 million per month out of Russia through crypto. Chainalysis reports that Russia accounts for about 12% of global crypto-based illicit transactions. In 2024, cryptocurrency fraud in the U.S. alone hit $9.8 billion - a 66% jump from the year before. The FBI says platforms like Garantex provide the infrastructure criminals need to move value across borders without detection. Even with the arrest of key figures like Aleksej Besciokov in India and the $5 million reward offered for the capture of Aleksandr Mira Serda, the network keeps running. The structure is decentralized now. No single server. No central office. Just a distributed network of Telegram bots, shell companies, and offshore accounts.Why This Matters Beyond Russia
This isn’t just a Russian problem. It’s a global one. When a crypto exchange can evade sanctions by shifting operations to Dubai, Hong Kong, and Kyrgyzstan, it undermines the entire system of international financial controls. Community banks in the U.S. are reporting more suspicious transactions tied to these networks. The Independent Community Bankers of America warned in August 2025 that "the persistent growth of crypto scams" requires urgent policy action. The Treasury’s strategy has shifted from targeting individual exchanges to dismantling entire networks. But experts like Chainalysis CEO Michael Gronager say sanctions are backfiring. "Sanctions are creating more sophisticated, harder-to-track money laundering systems rather than eliminating them," he said in September 2025.