The European Union (EU) has included Garantex, a Moscow-based cryptocurrency exchange, in its 16th round of sanctions against Russia. According to the EU, Garantex facilitated transactions related to cybercrime, black markets, and ransomware groups like Conti, making it a key link in money laundering and sanctions evasion.

Garantex – The Bridge That Helps Russia Evade Sanctions

According to a statement from the European Council, #Garantex was sanctioned for its links with Sberbank, Tinkoff Bank and Alfa-Bank – three Russian banks that have been on the EU sanctions list since 2014.

By converting Russian rubles from these banks into crypto, and then into other currencies, Garantex has helped Russian individuals and organizations access the global financial system.

The new package of sanctions is aimed at marking three years since Russia's invasion of Ukraine, targeting tankers, sanctions-evading banks and disinformation platforms, said EU High Representative for Foreign Affairs and Security Policy Kaja Kallas.

Garantex – The "Sinner" In The Cryptocurrency Ecosystem?

Not only being sanctioned by the EU, the US (OFAC) and the UK have blacklisted Garantex from 2022 and 2023.

According to Isabella Chase, Head of UK Regional Policy - #Eu at TRM Labs, Garantex has played a key role in facilitating illicit financial activity since its inception in 2019.

  • The exchange is accused of facilitating transactions related to cybercrime, darknet markets and ransomware.

  • Used to be the main platform for trading on Hydra Market, a major Russian online black market before it was shut down.

  • In 2024 alone, Iran's Garantex and Nobitex exchanges accounted for 85% of total flows into sanctioned entities.

Despite the sanctions, Garantex continues to process billions of dollars in transactions each year, suggesting that the ban may not be enough to stop the exchange's illegal activities.

Are Sanctions Effective?

Garantex remains a key node in Russia's cybercrime network, even after being sanctioned by the US and UK, according to Andrew Fierman, head of national security intelligence at Chainalysis.

He said the floor has:

✅ Support money laundering for Russian elites.
✅ Facilitates ransomware attacks.
✅ Help transfer money to propaganda campaigns.
✅ May be related to military supply chain.

While there are many other smaller exchanges operating in Russia, Garantex remains the top choice due to its strong liquidity and stable reputation, making it unlikely that sanctions will immediately stop the exchange from operating.

Sanctioned Entity Trading Activity Data

Data from two leading blockchain analytics platforms shows mixed results:

📉 According to TRM Labs, the total transaction value of sanctioned entities has decreased by 33%, from $21.9 billion (2023) to $14.8 billion (2024).
📈 Meanwhile, Chainalysis reported an increase from $14.9 billion (2023) to $15.8 billion (2024).

This difference may stem from the way it is calculated, as #Chainalysis 's data includes legal activity in sanctioned areas.

Conclusion: Can the EU Stop Garantex?

Despite being sanctioned by the US, UK and EU, Garantex remains a key cog in Russia’s underground financial system. With its stable reputation and strong liquidity, it is unlikely to be replaced anytime soon.

However, the pressure from the bans is still having an impact. If the crackdown continues, Garantex may have difficulty staying afloat, especially if law enforcement agencies crack down on the exchange's partners and customers.

Will the EU succeed in undermining Russia’s underground financial system? Or will Garantex find a way around the restrictions, as other illegal exchanges have done? That remains to be seen.