Ukraine’s prosecutor general’s office announced on Monday that authorities have seized a large amount of assets from over-the-counter (OTC) cryptocurrency brokers accused of illegally offering to buy cryptocurrencies to users from Russia and Russian-occupied territories.
Clients of these brokers are able to convert cash and non-cash funds into cryptocurrency without paying taxes, the announcement said.
Authorities are said to have confiscated €850,000, $470,000 and 460,000 Ukrainian hryvnia in legal cash, totaling about $1.67 million, as well as 830kg of silver, six plots of land and three apartments, without mentioning any crypto assets or wallets seized.
The assets, all the proceeds of illegal cryptocurrency transactions, are collectively worth about $3.39 million and will be handed over to Ukraine’s asset recovery and management agency, the attorney general’s office said.
The cryptocurrency brokers will also face criminal proceedings, with local prosecutors investigating allegations of fraud, money laundering and tax evasion against unnamed individuals.
In fact, following Russia’s invasion of Ukraine on February 24, the U.S. and European Union repeatedly sounded the alarm that Russia would use cryptocurrencies to circumvent sanctions due to the extensive international sanctions that followed, and the Russian government also reversed its stance on cryptocurrency regulation this year.
Russia’s finance ministry published a draft regulation of digital assets at the end of February and submitted it to the Russian government in April for approval as law.
The bill aims to provide clarity on the overall regulation of circulation, issuance, trading, mining and other activities within the cryptocurrency market, and to define cryptocurrencies as investment vehicles and maintain the ban on their use as a means of payment.
Due to sanctions, Russia seems to be willing to loosen the use of cryptocurrencies in international transactions recently. Elvira Nabiullina, governor of the Central Bank of Russia (CBR), said in June that it would accept the use of cryptocurrencies in cross-border or international payments, but the country is still inclined to ban it.
Yury Chikhanchin, head of Russia’s Federal Financial Monitoring agency, also said this month that it was ready to accept cryptocurrencies in international settlements.
Separately, Interfax reported that Anatoliy Aksakov, chairman of the Finance committee in the Duma (lower house of Parliament), last Thursday proposed the creation of a cryptocurrency market within the Moscow Stock Exchange (MOEX) that would comply with the central bank’s strict requirements.