The Kremlin has reported a significant increase in crypto transactions conducted in Russia, with transfer volumes doubling in 2023. According to Yuri Chikhanchin, the head of Rosfinmonitoring, the Federal Financial Monitoring Service, there has been a threefold rise in crypto transactions. This Kremlin-run agency is responsible for combating money laundering and terrorism funding in the country. Chikhanchin stated:
“The volume of transactions has almost doubled this year.”
In the first nine months of 2022, Rosfinmonitoring detected 60,000 crypto transactions using its monitoring tools. Chikhanchin highlighted that Russians are now involved in more crypto activity than ever before. He emphasized the urgency for the government to expedite the long-awaited crypto regulations, which have been stalled due to a disagreement between the anti-crypto Central Bank and the more progressive Ministry of Finance. Chikhanchin said:
“We need to resolve the impasse and establish clear guidelines for crypto transactions.”
Chikhanchin, who has been leading Rosfinmonitoring since 2012, spearheaded the development of the Transparent Blockchain tool. This tool, co-developed with VTB, a major commercial bank in Russia, aims to de-anonymize and track crypto transactions. Chikhanchin disclosed that the agency has recently shared this tool with commercial banks and international allies. He explained:
“With Transparent Blockchain, we can identify both crypto senders and recipients for over 30 cryptocurrencies.”
Furthermore, Rosfinmonitoring is collaborating with domestic partners to create a unified database of “gray addresses.” These are crypto wallets associated with suspected money launderers and criminals. Chikhanchin mentioned that the current database contains details of approximately 19,000 wallet addresses. Previously, the agency estimated that it was monitoring around 25,000 Russian crypto holders.
