TechFlow, July 24 — According to a report by TRM Labs cited by Cryptonews, Russian entities are leveraging Kyrgyzstan's cryptocurrency infrastructure to bypass international sanctions and procure dual-use civilian-military goods.
The report indicates that since Kyrgyzstan passed the "Virtual Assets Law" in January 2022, the country has emerged as a significant cryptocurrency hub. As of October 2024, 126 Virtual Asset Service Provider (VASP) licenses have been issued, with transaction volumes surging from $59 million in 2022 to $4.2 billion in the first seven months of 2024 alone.
TRM Labs found that several exchanges registered in Kyrgyzstan are shell entities, reusing identical addresses and contact information, and showing transactional links to sanctioned Russian organizations, including the Rusich paramilitary group which fought alongside the Wagner Group. After the Russian exchange Garantex was targeted by law enforcement in March 2025, new entities registered in Kyrgyzstan such as Grinex and Meer exhibited similar transaction patterns.
