report, according to Decrypt, a new report from the British blockchain intelligence company TRM Labs points out that some individuals and groups in Russia are using Kyrgyzstan's cryptocurrency ecosystem to evade international sanctions. Many platforms registered in Kyrgyzstan, including Grinex and Meer, have obvious connections with Russian exchanges like Garantex, and use Russian-backed stablecoins such as A7A5 to facilitate large-scale ruble-to-cryptocurrency transactions, whereas a month before the Russia-Ukraine war, the crypto industry "almost did not exist".
Additionally, the Kyrgyz government passed a law supporting cryptocurrencies in January 2022, effectively treating cryptocurrencies as property and establishing a registration system for virtual asset service providers (VASP). Combined with Russia's growing demand, the passage of this law led to rapid development of Kyrgyzstan's crypto industry, with VASP transaction volumes reaching $59 million by the end of 2022 and rising to $4.2 billion in the first seven months of 2024.
