According to the report, criminals defrauding Russian citizens have managed to launder some 295 billion rubles (over $4 billion) of stolen funds through crypto within a year. The report was released after a study conducted by Sberbank, Russia’s largest lender, the results of which were announced by one of its top executives.

Quoted by the Interfax news agency on Tuesday, Deputy Chairman of Sber’s Management Board Stanislav Kuznetsov detailed: “We have presented several figures here, based on analysis by Sberbank experts: nearly 300 billion rubles, or approximately $4 billion in stolen funds, are currently being withdrawn, one way or another, using cryptocurrency and crypto exchange offices.”

Russian fraudsters launder millions in rubles using crypto

Speaking at an international security forum held this week near the Russian capital, Kuznetsov noted these are not proper trading venues for digital assets. He made it clear he was referring to around 900 physical locations and online sites, including many on the darknet, that were active in the Russian Federation in 2025. These platforms accept the illegally obtained funds, convert them into digital money, and then back into fiat a few times before they are eventually withdrawn as cash, the banker explained.

The executive also noted that when cybercriminals attack companies or other organizations by blocking their operations with malicious software, the ransom demanded is usually paid directly in cryptocurrency. Kuznetsov reminded that Russia’s new law “On Digital Currency and Digital Rights” was recently passed on first reading by the State Duma, the lower house of parliament.

“We hope this law will move forward with a second and third reading very quickly. It will provide the basis for regulating this area, which we consider very important,” emphasized the Sber executive. The bill, which is part of a legislative package introducing comprehensive rules for the Russian crypto space, overcame its first parliamentary hurdle in April, as reported by Cryptopolitan. It aims to legalize the circulation of digital assets.

These assets include decentralized cryptocurrencies like Bitcoin and fiat-pegged stablecoins in the Russian economy. It should also widen access to include non-qualified investors, although a $4,000 annual limit for the latter, who will be able to buy only the most liquid cryptos, as well as the expected reduction of authorized exchange services, are likely to result in the opposite.

Under the legislation, which must be adopted and enforced no later than July 1, 2026, both private individuals and legal entities will be able to legally purchase coins only through approved intermediaries. This includes traditional banks, brokers, stock exchanges, and trustees, which will be allowed to work with cryptocurrencies under their existing licenses, as well as dedicated crypto platforms registered with the Central Bank of Russia (CBR), including exchanges and depositories.

Russia’s financial watchdog, Rosfinmonitoring, recently described crypto exchanges as a weak link in the country’s financial infrastructure, often used for money laundering, according to the business news portal RBC, which also relayed Kuznetsov’s comments. The government agency backed the adoption of strict regulations for the digital-asset trading platforms, similar to those that are in place for banking institutions.

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The crypto robber, a resident of Russia’s Leningrad Region, was been arrested in St. Petersburg after attempting to rob the exchange office at an apartment hotel. Local police said the attack took place late on Saturday, in the building located on Khersonskaya Street of the country’s second-largest city.

Russian authorities arrest crypto criminal

The crypto robbery was prevented by Russian police officers who arrived at the scene after receiving a report about a noisy conflict that evening. The 21-year-old attacker used a strikeball and smoke grenades, the regional department of the interior ministry detailed in a press release, quoted by Fontanka.ru, Gazeta.ru, and other Russian media on Sunday.

The man entered the office of the exchange service, detonated two of the airsoft grenades, and ignited the smoke bomb. He then demanded that the employees of the crypto trading firm transfer its digital assets to a wallet he provided. The failed robber was apprehended with the assistance of servicemen from Russia’s National Guard, who came to the aid of the police officers.

Bomb disposal specialists who inspected the area confirmed that the devices used in the attack were, in fact, airsoft replicas that create a lot of noise and smoke without causing serious damage. Two more were seized from the perpetrator. Russian authorities have opened a criminal investigation into the attempted robbery, and a decision on whether the man should remain in pretrial detention is under consideration.

Similar cases where criminals try to forcefully take control of victims’ cryptocurrency have been on the rise over the past months. Russian crypto owners are increasingly facing hybrid attacks, where wallet hacks are accompanied by theft and threats of physical violence, the “Delovoy Peterburg” publication noted in a recent report, highlighting a surge in kidnappings.

Perhaps the most remarkable example of this trend lately was the kidnapping of a Russian crypto businessman and alleged scammer last October. The kidnappers believed he owned a fortune in digital assets when they kidnapped him. However, they ended up torturing Novak and his wife, murdering and dumping their corpse in the long run.

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This tragic event marked a sinister chapter in cryptocurrency, sparking widespread speculation and investigation.

The ascent of Garantex

Garantex, under the leadership of Drugalev and co-founders Sergei Mendeleev and Alex Ntifo-Siao, rapidly evolved from a modest initiative in Estonia to a powerhouse in the cryptocurrency world. The platform capitalized on the global shift towards digital currencies during the COVID-19 pandemic, with its daily transactions peaking at a staggering 300 million rubles. 

The success brought its founders a lavish lifestyle filled with high-end real estate and luxury acquisitions. The narrative took a complex turn with Pavel Karavatsky’s entry. His history in Russian law enforcement and connections with the financial elite colored his involvement. Blavatsky, known for his ties to influential figures like Oleg Feoktistov and Ivan Tkachev from Russia’s security sector, aligned with Ntifo-Siao. 

Their partnership strengthened significantly in early February 2021, just days before Drugalev’s mysterious death. Karavatsky and Ntifo-Siao became beneficiaries of Fintech Corporation LLC, linked to Rosneft, signaling a move to seize control over Garantex. This strategic maneuver coincided with the troubling events leading to Drugalev’s demise.

Mysterious death and power struggles

Drugalev’s unexpected presence in Dubai and his subsequent death raised many questions. Theories about his end range from an accidental drowning to more nefarious motives, fueled by his connections and the critical data reportedly missing from his laptop. Following his death, Garantex plunged into chaos. 

Ntifo-Siao and Karavatsky quickly moved to consolidate their power, altering the company’s charter and reshuffling the board to secure their control. The aftermath saw Garantex’s governance shift drastically, with changes made to benefit a select few. 

These actions coincided with a legal challenge from Drugalev’s father, Konstantin Khazan, who fought against the unethical amendments to the charter that sidelined the legal heirs from their rights. After an initial defeat, Khazan’s persistence was rewarded by the Moscow City Court, which restored a significant portion of ownership to Drugalev’s family.

Government shadows and legal labyrinths

Beyond the personal tragedies and corporate battles, the Garantex saga suggests deeper state involvement. Karavatsky’s rise within the company and his connections imply a broader strategy by Russian governmental entities to leverage Garantex for state interests. 

This hypothesis is supported by the opaque nature of the ownership changes and the strategic legal maneuvers that followed. Parallel to the main events at Garantex, the Flip Animation Studio, which is involved in the animation industry, emerged as a front for questionable financial operations, potentially including money laundering. 

The intricate connections between Garantex, the animation studio, and Russian power brokers underline the complex interplay of business and politics in the shadows of the crypto world.

The unfolding story of Garantex offers a cautionary tale about the intersection of technology, finance, and power, where the lines between legal enterprise and governmental overreach become blurred. The true impact of these events continues to unfold, influencing the cryptocurrency landscape and the regulatory challenges it faces.

The post Cryptocurrency Undercurrents: Exposing Deceit at Garantex first appeared on Coinfea.