The U.S. Treasury’s Office of Foreign Assets Control (OFAC) has imposed sanctions on companies and individuals accused of using stablecoins to circumvent sanctions against Russia. Among the targets are A7 LLC, creator of the ruble-backed A7A5 stablecoin, and Kyrgyzstan-based Old Vector LLC, which facilitated large-scale transactions for sanctioned entities. The Treasury also sanctioned entities tied to Garantex, a crypto exchange used for illicit fund transfers, and its successor Grinex. These actions highlight OFAC’s intensified scrutiny of stablecoins, which regulators view as a growing threat to sanctions enforcement. Blockchain analytics firm Elliptic has updated its tools to help detect and block transactions linked to the sanctioned entities.
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0 in Finance and 0 in Crypto last weekRussia Eyes Ruble Stablecoin Amid Regulatory Hurdles
Sergey Mendeleev, founder of Exved and former head of Garantex, outlined seven criteria for a Russian ruble stablecoin at the Blockchain Forum in Moscow. Key requirements include untraceable transactions, no KYC checks, overcollateralization (similar to DAI), and compliance with Russian laws—though Mendeleev expressed skepticism due to the country’s tightening crypto regulations. He emphasized the need for liquidity on both centralized and decentralized exchanges, interest-earning smart contracts, and untraceable transactions. While technically feasible, regulatory hurdles and Russia’s push for centralization pose significant obstacles. Meanwhile, the Bank of Russia continues developing its digital ruble, set for a 2025 rollout.
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