Written by: Anita

Mornings in Moscow during winter always come slowly.

The subway glides from the gray residential areas into the city center, and the advertisements on the screens in the carriages typically scroll through ruble loans, online shopping promotions, and a banner that looks quite normal:

"Overseas income settlement? USDT is also acceptable."

It's hard to imagine that in a country besieged by the Western financial system, the term "stablecoin," which originally appeared only in Silicon Valley white papers, has quietly become a fundamental infrastructure that ordinary people and businesses genuinely rely on.

Alexey (a pseudonym), 34, claims to be "in IT consulting," but his true identity is a small node in a stablecoin black market chain in Moscow.

At nine in the morning, his work begins with checking Telegram channels.

There are four or five groups on his phone, such as "Moscow USDT local price," "freelancer settlement channel," and "rubles cash exchange / card transfer - for acquaintances only."

Each group has bots reporting prices—"Buy USDT at 76.3, sell at 77.1." Deeper down, there are dozens of private chat windows, with young people doing outsourced development, wanting to convert dollars from clients into USDT and then into rubles; small companies importing minor parts needing to pay Turkish suppliers in USDT; and strangers with accents saying just one thing: "Large amount, meet offline."

Alexey's way of making a profit is simple: he earns a small price difference through minor transactions or takes a tiny "service fee" from larger orders, linking back to bigger exchange operators or trading platforms.

On the surface, all this seems like mere "currency exchange," but the funds quickly flow into deeper undercurrents.

Some deposit USDT into local exchanges with Russian-friendly interfaces and then convert it into Bitcoin to move it out; others wash funds into offshore accounts through Russian platforms like Garantex; and some use it to provide liquidity to companies in Georgia and the UAE.

By evening, he divides the USDT earned that day into two parts: one part is sold for rubles to pay the mortgage and buy groceries, while the other part quietly rests in a multi-signature wallet, waiting for a day when the situation changes again; it might be the last line of insurance for his family.

On the statistics sheet, he is just a small point of "Russian retail crypto inflow."

But all these points connected form the invisible market.

1. After being cut off, new veins grow underground

The crypto story in Russia did not start only after sanctions.

In 2020, Eastern Europe was already one of the regions with the highest "criminal-related crypto transaction volumes" globally. Chainalysis research showed that the dark web received a record $1.7 billion in cryptocurrency that year, most of which flowed to one name: Hydra. Hydra was the largest dark web market in the world, accounting for 75% of the global dark web market revenue at its peak.

Before being shut down by German police in April 2022, it was essentially a massive "dark economic center"—drugs, fake documents, money laundering services, biometric data, all "transactions not recognized by the official world" were settled in stablecoins.

The fall of Hydra did not make this chain disappear; it merely caused the shadows to redistribute: its users, infrastructure, and intermediary networks later recombined among Garantex, Telegram OTC, and small exchanges.

The dark side of Russia's crypto economy did not emerge only after sanctions; it has deep historical roots.

Since the outbreak of the Russia-Ukraine war in 2022 and the escalation of sanctions, Russia has been besieged in the traditional financial world: foreign exchange reserves were frozen, major banks were excluded from SWIFT, and Visa and Mastercard collectively withdrew. For a country that relies on energy and commodity exports, this was almost like having its neck squeezed.

But the numbers on the blockchain tell another story:

According to Chainalysis statistics on European crypto activity from July 2024 to June 2025, Russia received crypto assets worth $376.3 billion during this period, firmly ranking first in Europe, far exceeding the UK's $273.2 billion.

In Bitcoin mining, Russia is no longer an invisible player. The latest estimates from the hash rate data platform Hashrate Index show that by the end of 2024, Russia accounts for about 16% of the global Bitcoin hash rate—second only to the United States.

These two numbers are cold, yet they are enough to illustrate:

When the world tries to push Russia out of the traditional financial system, a new, underground crypto economy is rapidly growing.

If OTC traders like Alexey are the capillaries, then local exchanges like Garantex are the heart of the black market.

Garantex was initially registered in Estonia, but its business focus has always been in Moscow. Starting in 2022, it was gradually added to the sanctions lists by the U.S. Treasury and the European Union, accused of facilitating ransomware, dark web transactions, and sanctioned banks.

Logically, such a platform should have "died" long ago. However, in September 2025, a report disclosed by the International Consortium of Investigative Journalists (ICIJ) showed that despite facing multiple blows, Garantex was actually "continuing to operate in the shadows," providing crypto exchange and transfer services for clients in Russia and surrounding regions through a series of offshore companies, mirror sites, and proxy accounts.

Even more strikingly, a deep report from blockchain analysis company TRM Labs pointed out that in 2025, Garantex, along with the Iranian exchange Nobitex, contributed over 85% of the crypto funds flowing into sanctioned entities and jurisdictions.

In March 2025, Tether froze USDT wallets related to Garantex worth about $280,000 (approximately 2.5 billion rubles), forcing the exchange to announce a business suspension. But a few months later, the U.S. Treasury sanctioned a new name: Grinex—"a cryptocurrency exchange created by Garantex employees to assist in evading sanctions."

The black heart was struck once but began to beat again in a new form.

2. A7A5: The ambition and paradox of "rubles on the blockchain"

USDT is currently the main character in Russia's shadow economy, but in the eyes of Moscow officials, it has a fatal flaw—it is too "American" and too "centralized."

In 2025, a new piece was quietly pushed onto the board: A7A5, a stablecoin issued by a platform in Kyrgyzstan, claiming to be "rubel-pegged."

The Financial Times revealed in an investigation that A7A5 completed approximately $6 to $8 billion in equivalent transactions within four months, most of which occurred on weekdays and were concentrated during Moscow trading hours, with the custodian bank being Russia's sanctioned defense bank, Promsvyazbank.

The EU and UK sanctions documents straightforwardly describe it as "a tool for Russia to evade sanctions." By October 2025, the EU officially included A7A5 in its sanctions list, and blockchain analysis companies pointed out its close coupling with Garantex and Grinex—becoming a new central node in the Russian crypto clearing network.

The role of A7A5 is subtle:

1. For Russian enterprises, it is a "rubel stablecoin that can bypass USDT risks";

2. For regulators, it is an "invisible tool to put rubles on the blockchain and conveniently bypass bank scrutiny."

Behind this is an increasingly clear idea in Russia: "Since we cannot do without stablecoins, at least a part of it should be printed by ourselves."

But the paradox is that any stablecoin wanting to go global must rely on infrastructures that Russia cannot control: public blockchains, cross-border nodes, overseas exchanges, and third-country financial systems.

A7A5 wants to become a "sovereign stablecoin," yet it has to circulate in a world that Russia does not control. This is a microcosm of Russia's entire crypto strategy—it wants to break free from Western finance while having to continue using the "on-chain financial building blocks" set up by the West.

3. What does crypto mean for Russia? Not the future, but the present

The Western world often views crypto as an asset, a technology, or even a culture. But in Russia, it plays a completely different role:

1. For businesses: Crypto is a backup channel for trade settlement.

Russia imports high-tech components, drone parts, industrial instruments, and even consumer goods, many of which cannot be paid through traditional banking systems. Thus, a secret but stable route has formed: Russian enterprises export to intermediaries in the Middle East/Central Asia, then circulate through USDT/USDC to suppliers, and finally return to Moscow OTC to exchange for rubles.

It is not sophisticated, not romantic, not "decentralized," but it works, it moves, it lives.

Crypto here is not a dream; it is the only realistic option with the lowest efficiency.

2. For young people: Crypto is an outlet to escape the local currency.

The Russian banking system has long been distrusted, and the ruble's weak performance over the years has made crypto the most natural asset haven for the middle class and young engineers.

If you ask any software engineer in Moscow, they might not say, "I trade coins," but rather, "I convert my salary into USDT and keep it with a trusted OTC team on Telegram. The bank freezes my card, but the chain won't freeze me."

This sentence is a reflection of contemporary Russia.

3. For the state: Crypto and mining are "digital energy exports."

Russia has some of the cheapest electricity in the world—hydropower and excess natural gas in Siberia have become a paradise for Bitcoin mining.

Mining provides: an "export product" that bypasses the banking system, a globally exchangeable digital commodity, and a way to evade financial blockades.

The Russian Ministry of Finance has officially acknowledged multiple times that "mining revenue is a necessary component of the national trade system."

This is no longer a grassroots activity but a quasi-state economic sector.

4. For the gray system: Crypto is an invisible lubricant.

This part is difficult to quantify, but the existing facts include European intelligence agencies pointing to Russian intelligence departments using crypto to pay for information warfare, hacking operations, large-scale underground funds traversing between Europe and Russia using stablecoins, and various smuggling networks heavily relying on on-chain funding tracks.

Is Russia a "crypto superpower"? The answer is more complex than imagined.

If you measure by technological innovation, it is not.

If you look at VC projects and DeFi, it is also not.

If you measure by mining, on-chain transaction volume, stablecoin inflow, and reliance on trade settlement, it is a crypto power center that the world cannot ignore.

It is not "voluntarily becoming" but rather "being pushed to become" by the world.

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