Garantex Halts Operations Following Tether Freeze
The sanctioned crypto exchange Garantex has made the decision to halt operations after Tether froze $27 million worth of USDT on their platform.
Temporary Suspension of Services
In an announcement on Telegram on March 6, Garantex confirmed that they are temporarily suspending crypto trading and withdrawals due to Tether’s actions.
“Tether has entered the war against the Russian crypto market and blocked our wallets worth more than 2.5 billion rubles. We are temporarily suspending all services, including cryptocurrency withdrawals, while our entire team solves this problem.”
The exchange expressed concern that this move could set a precedent, putting all Russian USDT holdings at risk. They have stated their intention to challenge the decision, noting that while they may be the first exchange affected, they are unlikely to be the last.
As of now, Tether has not provided an official response or explanation for the freeze. They have not responded to CryptoSlate’s request for comment.
Tether is the issuer of USDT, the largest stablecoin with a market capitalization exceeding $140 billion.
Garantex Sanctions and Investigations
This development comes amidst increasing sanctions against Garantex for allegedly aiding Russia in bypassing Western financial restrictions.
The US Treasury’s Office of Foreign Assets Control (OFAC) initially sanctioned the exchange in April 2022 as part of efforts to combat illicit financial activities.
More recently, the European Union also imposed sanctions on Garantex, citing its connections to Russian banks already under EU restrictions. This marked the first direct sanction by the EU against a Russian crypto exchange.
Authorities in the US and UK are investigating Garantex for allegedly facilitating over $20 billion in transactions aimed at evading sanctions. Regulators suspect the platform played a role in Russia’s financial strategies related to the ongoing conflict.
