Russian citizen sentenced to seven years for using crypto to fund Ukrainian military; Russia tightens crypto regulations.

In a significant development, a Russian citizen has been sentenced to seven years in prison for using cryptocurrency to finance the Ukrainian Armed Forces. Russia has seen its first cryptocurrency case of financing a military organization.

A worker at a diamond mining company, the man lived in the Mirninsky District of Yakutia. He was charged with giving financial help to a Ukrainian terrorist group. A man transferred funds to Ukrainian militants via cryptocurrency, the FSB Directorate for the Republic of Sakha (Yakutia) reported. As a result, these funds were used to support a unit of AFU to carry out subversive activities against Russia’s security.

Moreover, the man joined a group on a social network related to the Ukrainian military. Ukrainian handlers instructed how to transfer money to the cryptocurrency wallet. This led to high treason charges under Article 275 of the Russian Criminal Code. The man, now 28, could spend seven years in a maximum security penal colony.

Russia Strengthens Crypto Regulations to Curb Illegal Military Funding

It came after another arrest in the Donetsk People’s Republic (DPR). On January 10, a man from Yenakiyevo was arrested on suspicion of treason. According to him, funds were transferred to accounts that were funding the Ukrainian Armed Forces. He allegedly sent money to support Ukraine’s military efforts, the authorities say.

The use of cryptocurrency in lending its support to foreign military organizations is making it a concern for Russia. Unlike traditional financial transactions, it is hard to trace. For that reason, it is primarily utilized for illegal purposes, including prostitution and funding terrorism. In this regard, the Russian government is tightening its control and monitoring power on cryptocurrency transactions.

The arrests highlight the rising dangers cryptocurrency presents for illegal use. Furthermore, regulations across the world are tightening to prevent the use of digital currencies for support of criminal groups. However, with the emergence of cryptocurrency, it is likely more countries will act to curb its use and fund foreign military organizations. Finally, Russia is leading this effort by introducing stronger laws aimed at protecting national security.