Russia is using cryptocurrencies to pay saboteurs carrying out hybrid attacks across the European Union, according to a senior Polish security official.
Key Takeaways:
Poland says Russia’s GRU is using cryptocurrency to fund sabotage and cyberattacks across the EU. The payments help Moscow evade Western intelligence tracking and bypass financial sanctions. Poland has tightened crypto regulations to close potential funding loopholes used by Russian agents.The method, he said, allows Moscow to conceal financial flows and evade detection by Western intelligence services, according to a Monday report by the Financial Times.
Russia’s GRU Funding Sabotage Operations with Cryptocurrency
Sławomir Cenckiewicz, head of Poland’s National Security Bureau, told the FT that Russia’s military intelligence agency, the GRU, has been using crypto to finance operations ranging from sabotage to cyberattacks on critical infrastructure.
“A network of agents recruited by Russia’s GRU military intelligence agency, which was uncovered in Poland in 2023, had to a high extent been financed with cryptocurrency,” Cenckiewicz said, adding that Warsaw believes Moscow continues to rely on such methods.
Last month, Poland’s lower house of parliament approved new legislation tightening oversight of the crypto-asset market, including prison terms for violators. Cenckiewicz said the measure is also meant to block Russian funding routes.
“The Polish intelligence services are very much interested in this whole legislative process, to ensure there are no gaps that would allow foreign powers to use [crypto] to finance their agents,” he said.
The Kremlin has increasingly turned to digital assets to bypass Western sanctions and sustain operations after its banks were excluded from the Swift payment system following the 2022 invasion of Ukraine.
“When we look at the cyber domain, Poland is now in a state of war [with Russia]; it’s not a state of threat any more,” Cenckiewicz warned.
Over the past year, Polish authorities have shut down two Russian consulates and expelled several Russian and Belarusian diplomats accused of aiding sabotage networks.
Cenckiewicz said these officials were “the first layer” of infiltration, noting that Moscow now depends on “ad hoc” local agents paid small sums in crypto.
“There is no doubt that the Russians had some assets among these people,” he added.
EU Eyes Sanctions on Russian Ruble-Backed Stablecoin A7A5
As reported, the European Union is weighing a fresh round of sanctions targeting A7A5, a ruble-backed stablecoin that has rapidly become the largest non-US-dollar pegged token in the world.
The move would prohibit EU-based individuals and companies from interacting with the token, either directly or via intermediaries.
The EU’s efforts follow similar moves by the US and UL, which in August sanctioned Capital Bank of Central Asia and its director, Kantemir Chalbayev, along with Kyrgyz exchanges Grinex and Meer, all accused of helping Russia’s financial sector evade restrictions.
A7A5 was launched in February by A7, a cross-border payments firm owned by Moldovan fugitive banker Ilan Shor and Russia’s state-owned lender Promsvyazbank (PSB). Both entities are under US, UK, and European Union sanctions.
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