Two major Russian companies are using tether (USDT) and other cryptocurrencies to settle cross-border transactions in China as sanctions tighten, Bloomberg reports.
Executives from two top commodities trading firms producing metal in Russia told Bloomberg, on the condition of anonymity, that USDT is used in some of these transactions when dealing with mostly Chinese clients and suppliers.
Sanctions imposed on Russia following the Ukraine war have made it harder for commodities firms, such as those trading steel and timber, to receive payments. In April 2024 the London Metal Exchange and Chicago Mercantile Exchange were banned from accepting metal exports from Russia following UK and US sanctions.
CEO of stablecoin infrastructure firm Reslov Labs, Ivan Kozlov, told Bloomberg, “In countries that are facing dollar liquidity issues and capital controls, cross-border settlements through cryptocurrencies and, specifically, dollar-linked stablecoins, are a relatively common practice, and not only in commodities.”
Venezuela’s state oil company is also reportedly planning to up its use of crypto following sanctions from the US which kick in today. The firm had already slowly introduced USDT as a means to sell its oil, but the sanctions have reportedly speeded up the transition.
Sanctioned crypto exchange Garantex is also the subject of a probe from the UK and US over the alleged use of $20 billion worth of USDT to dodge sanctions. A smuggler reportedly used the Russian-based exchange to purchase guns and ammo for the Russian military with USDT.
Garantex is also reported to share ties with a convicted gang member, a violent debt collection agency, and a state-backed oil company in Russia.