A Russian legislator who was one of the authors of the bill to legalize cryptocurrency mining in the country is tied to a local over-the-counter (OTC) exchange known as Bankoff.
Russian opposition activist Mikhail Khodorkovsky linked Bankoff OTC to lawmaker Andrei Lugovoi in an article by the London-based research project Dossier Center on December 19.
The 6,000-word article was accompanied by a video titled “Crypto-Kremlin: How the Authorities Launder Bitcoin,” released on Khodorkovksy’s Live YouTube channel.
According to Dossier, Bankoff is the most active peer-to-peer trader using Russian rubles on major global crypto exchange Binance. As previously reported, Binance continued to serve unsanctioned Russians despite the European Union banning all crypto transactions for Russia in October. The Bankoff OTC platform only accepts cash from customers and has almost no Anti-Money Laundering or Know Your Customer checks.
What is the reason you want to change the cost of your order? Check whether the device is connected to the device or to the device. How does it work? https://t.co/ndd62kxy3n
— Центр «Досье» – право на справедливость (@dossier_center) December 19, 2022
The trader’s office is reportedly located on the 65th floor of a building in the Moscow City skyscraper district. The property is owned by the Bratsk Electricity Network, a company that distributes electricity around the east-central Russian city of Bratsk, a center of cryptocurrency mining.
According to Dossier, Bankoff could earn up to $20,000 daily with up to 4% in commissions on users’ crypto transactions. Lugovoi’s wife Ksenia Lugovaya also reportedly has a stake in Bratsk Electricity Network since 2018. A statement filed by her husband and allegedly shown in the Dossier video indicates that in 2021 Lugovaya had an income of 29.6 million rubles, or something more than $400,000. with no sources of income other than the Bratsk electricity company.
The Dossier article and video also detail how a Dossier representative was reportedly able to convert 100,000 rubles ($1,400) into Tether (USDT) using the sanctioned Russian crypto exchange Garantex. The rep was reportedly able to send USDT from Garantex to Binance and then successfully transfer it to an account in UK-based fintech Wise, allowing the distribution of that money despite United States sanctions.
Such a plan not only allows Russian government officials to avoid sanctions, but also earns them money, the speaker argued in the video, stating:
“That doesn’t stop Russian officials and members of the security forces from using cryptocurrency not only to get millions out of the country, but also to monetize it. People under close scrutiny by law enforcement around the world have long been bound by this.”
While apparently profiting from crypto themselves, Russian lawmakers have actively opposed the idea of crypto investments by ordinary people. The Russian government has not legalized any local cryptocurrency exchange, while the central bank has taken a firm stance against crypto investment.
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In addition to supporting one of the largest crypto OTC platforms in Russia, Lugovoi is known for developing local cryptocurrency laws. He is one of the authors of the cryptocurrency mining law that was introduced in the Russian lower house on November 17. Lugovoi began his political career after being involved in the 2006 poisoning of former Russian security agent Alexander Litvinenko in the United Kingdom.
Additional reporting by Helen Partz.