Russia Shuts Down Nine Crypto Exchanges Over Alleged Fraud and Money Laundering Links
Key Takeaways
- •The FSB closed nine unregistered cryptocurrency exchanges at Moscow City and detained more than 20 employees during coordinated raids.
- •The exchanges allegedly laundered fraud proceeds by converting stolen funds from telephone scams into cryptocurrency before transferring them to Ukraine-linked accounts.
- •Russian law imposes criminal penalties on unregistered crypto operations, including up to seven years imprisonment and fines of approximately $13,100 for large-scale offenses.
- •The Interior Ministry has launched a criminal fraud investigation and is working to identify additional victims for potential compensation.
- •The crackdown coincides with Russia's broader push to formalize cryptocurrency regulation, with new comprehensive rules scheduled to take effect in 2026.
Russia's Federal Security Service (FSB) has shut down nine unregistered cryptocurrency exchanges in Moscow over alleged money laundering tied to fraud proceeds, the agency announced.
More than 20 employees were detained during coordinated raids conducted at the Moscow International Business Center, commonly known as Moscow City. According to the FSB, the exchanges converted funds stolen from Russian victims of telephone scams into cryptocurrency and then transferred the proceeds to accounts linked to operators based in Ukraine.
The operation was carried out jointly with Russia's Interior Ministry. Authorities also targeted couriers who allegedly collected cash directly from victims and delivered it to the exchanges for conversion into digital assets. Telephone fraud has been a persistent concern for Russian law enforcement, with authorities previously reporting significant annual losses from such schemes targeting elderly and vulnerable citizens.
The Interior Ministry has launched a criminal investigation into large-scale fraud. Officials said efforts are ongoing to identify additional victims and assess potential compensation.
Under Russia's cryptocurrency legislation, individuals and entities that organize or facilitate crypto-related transactions without registering with the central bank may face criminal penalties. Basic violations carry fines of up to approximately $4,000 and prison terms of up to four years.
Harsher penalties apply to large-scale offenses or cases involving organized groups. In such circumstances, punishments can include up to seven years in prison or compulsory labor for up to five years, along with fines reaching roughly $13,100 or equivalent income-based penalties.
The enforcement action comes as Russia continues to bring cryptocurrency trading under a formal regulatory framework, with new rules taking effect in 2026. Russia has incrementally expanded its crypto oversight in recent years, including provisions permitting digital assets for cross-border transactions under central bank supervision.
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