Russia's Crypto-Powered Sanctions Evasion Network Exposed

A Kremlin-backed fintech company is linked to massive sanctions evasion through a ruble-backed cryptocurrency.

Mar. 31, 2026 at 10:37am

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An abstract, fractured painting in dark blue, steel grey, and muted red tones, depicting the concept of a complex, anonymized cryptocurrency network used to evade sanctions.A fractured, geometric painting illustrates the complex, anonymized nature of Russia's crypto-powered sanctions evasion network.Washington Today

A Moscow-based fintech startup called A7, backed by the Russian state-owned bank Promsvyazbank, has developed a ruble-linked cryptocurrency called A7A5 that is being used to evade Western sanctions on Russia. The cryptocurrency is regulated by authorities in Kyrgyzstan and allows Russian firms to convert rubles into the digital asset, bypassing restrictions on ruble payments. A7A5 can then be instantly swapped for mainstream stablecoins without identity verification, making it difficult for authorities to trace the transactions back to sanctioned Russian entities.

Why it matters

This crypto-based sanctions evasion channel highlights the challenges Western policymakers face in curbing Russia's efforts to circumvent the impact of economic sanctions. The anonymity and cross-border nature of cryptocurrencies make it difficult for authorities to monitor and disrupt these illicit financial flows, which are estimated to be equivalent to a significant portion of Russia's total imports.

The details

A7, founded by fugitive Moldovan oligarch Ilan Shor after Russia granted him citizenship, is 49% owned by Promsvyazbank, which serves Russian defense firms. The A7A5 cryptocurrency is backed by Promsvyazbank's deposits and features instant swap services to convert it into mainstream stablecoins, all without know-your-customer (KYC) checks to verify identities. This anonymity makes it challenging for authorities to trace transactions back to sanctioned Russian entities.

  • In late 2024, the Kremlin supported the creation of A7, the Moscow-based fintech startup that specializes in cryptocurrencies.
  • In September 2025, Russian President Vladimir Putin attended a virtual ribbon-cutting ceremony for the opening of A7's Vladivostok branch.
  • In early March 2026, Kyrgyzstan announced it was preparing to take the European Union to court over the bloc's threat to ban exports of sensitive dual-use goods to the country to prevent their reexport to Russia.

The players

A7

A Moscow-based fintech startup that specializes in cryptocurrencies and is 49% owned by the state-owned bank Promsvyazbank, which serves Russian defense firms.

Ilan Shor

A fugitive Moldovan oligarch who founded A7 after Russia granted him citizenship.

Promsvyazbank

A state-owned Russian bank that controls 49% of A7 and serves Russian defense firms.

Vladimir Putin

The President of Russia, who attended a virtual ribbon-cutting ceremony for the opening of A7's Vladivostok branch in September 2025.

Kyrgyzstan

A Central Asian state that is home to the obscure firm Old Vector, which regulates the A7A5 cryptocurrency.

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What’s next

Western policymakers are exploring options to curb the rise of cryptocurrencies designed for illicit activities, such as pressuring issuers of dollar-pegged stablecoins to implement robust KYC checks and leveraging Kyrgyzstan's dependence on EU-made dual-use products to disrupt the A7A5 network's operations.

The takeaway

Russia's development of a crypto-based sanctions evasion channel powered by the A7 fintech company and the A7A5 cryptocurrency highlights the challenges Western authorities face in combating the use of digital assets for illicit financial flows. This case underscores the need for greater international cooperation and innovative policy approaches to address the evolving landscape of sanctions evasion.