Cryptocurrency

Russians Sell Billions Of Dollars Worth Of Cryptocurrencies To Escape Sanctions

Russians Sell Billions Of Dollars Worth Of Cryptocurrencies To Escape Sanctions

Investors are turning to companies in Dubai to cash out digital assets, or invest them in real estate.

Users from Russia are selling cryptocurrencies through companies in the United Arab Emirates for fear of asset freezes. This became known to Reuters.

Cryptocurrency firms in the UAE are receiving requests from Russians to sell cryptocurrencies in large volumes. One company has received a large number of inquiries from Swiss brokers over the past 10 days asking them to liquidate billions of dollars in bitcoin as clients fear that Switzerland will freeze their assets. The minimum bid amount was $2 billion, according to the firm’s chief executive.

“None of them has yet been implemented – they refused at the last minute, which is not uncommon. But we have never seen such an increased interest,” he stressed. “We have this guy – I don’t know who he is, but he contacted through a broker – and they’re like, ‘We want to sell 125,000 bitcoins.’ And I’m like, ‘What? That’s $6 billion guys.” And they’re like, “Yeah, we’re going to ship them to Australia.”

Financial experts believe that holders from the Russian Federation are looking for alternative ways to store their money, fearing international sanctions. Dubai has long attracted rich people from all over the world as a financial and cryptocurrency center, and the UAE’s refusal to impose sanctions on Russians has given the latter hope to save money. Some of them are investing tokens in real estate in the United Arab Emirates, while others are trying to convert digital assets into fiat currencies with the help of Arab firms and hide them in foreign accounts. A source in the Emirates confirmed that the Russians were buying properties in Dubai using cryptocurrencies to withdraw money.

“They are basically trying to protect themselves from the inflationary pressure that is happening against the Russian currency. Therefore, cryptocurrency has become a very good outlet for them to manage the risks they face. It is a good guarantee of liquidity for them,” explained Apoorv Trivedi from the consulting Healy Consultants.

A real estate broker whose company is partnering with a cryptocurrency service told Reuters that many Russians and Belarusians come to Dubai and “bring whatever they can, even in crypto.” Three Western diplomats said they were concerned about the number of Russian citizens who have tried in recent weeks to withdraw their assets in the UAE, including property. Diplomats fear that some of them may be acting on behalf of people who are under sanctions.

Two diplomats were skeptical that the UAE could prevent the Russians from withdrawing their funds, because the country adheres to neutrality. According to other sources, eventually the authorities of the United Arab Emirates will realize the negative consequences for their reputation and will also introduce restrictions.

This month, the UAE was placed on a “grey list” for increased scrutiny by the Financial Action Task Force (FATF). The agency pointed to risks in certain industries, including real estate agents and precious metals dealers.

The Swiss Secretariat for Economic Affairs (SECO) told Reuters that crypto assets are subject to the same sanctions and measures that Switzerland has imposed on “regular” Russian assets and individuals. If a person is under sanctions, their crypto assets should also be frozen.

 

Previously, they wrote that the Russians are actively trading cryptocurrencies in spite of the sanctions . In one day, only in a pair of bitcoin-ruble, users of exchanges made transactions for a record amount of $14 million.

It was also reported that Coinbase and Binance refused to block Russians from accessing their platforms . According to the leaders of the exchanges, the restrictions contradict the essence of cryptographic technologies.

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