Russia Blacklists WhiteBIT After Alleged $11 Million Ukraine Donations

Highlights:

• Russia has blacklisted WhiteBIT and blocked the exchange from operating inside the country.
• Russian prosecutors say the exchange supported Ukraine-linked fundraising during the war.
• Global regulators are tightening oversight of crypto networks tied to sanctions evasion.

Russian authorities have blacklisted crypto exchange WhiteBIT and its parent company W Group, designating both as undesirable organizations under national law. The Prosecutor General’s Office placed both entities on Russia’s enforcement registry. The designation requires WhiteBIT to stop all activity inside the country. Authorities ordered the exchange to shut down operations without delay.

The ruling blocks WhiteBIT from holding bank accounts in Russia. It also bans fund transfers and customer servicing. Regulators said the exchange may not maintain any commercial presence. Russian law criminalizes cooperation with organizations on the registry. Individuals and companies will face fines for engaging with the platform.

The courts may also pursue criminal proceedings in severe cases, and the penalty may include imprisonment under the statute. Authorities indicated that foreign financial platforms should not act contrary to national interest in times of war.

Regulators have tightened restrictions on digital asset services since the start of the war. Prosecutors also accused WhiteBIT of facilitating Russian fund outflows. They claimed the platform applied gray schemes to circumvent limitations. The authorities referenced WhiteBIT as a Ukrainian-based European platform. Even though the company is based in Lithuania, prosecutors highlighted that it was founded in Ukraine.

Russia Blacklists WhiteBIT Under Wartime Crypto Restrictions

Prosecutors accused WhiteBIT of providing financial and technical support to Ukraine-linked initiatives. Authorities said the exchange assisted fundraising programs tied to Ukraine’s Armed Forces. According to officials, WhiteBIT’s management transferred about $11 million in 2022. Prosecutors alleged that roughly $900,000 funded drone procurement.

The donation figure aligns with amounts disclosed on WhiteBIT’s public website. The exchange has acknowledged charitable contributions related to Ukraine since the war began. Authorities cited these disclosures when announcing the designation. Prosecutors said the support extended beyond basic donations.

Officials highlighted WhiteBIT’s involvement with United24. United24 operates as a crypto-enabled fundraising platform launched at the initiative of President Volodymyr Zelenskyy. Prosecutors said WhiteBIT provided technical infrastructure for the platform. Authorities linked this role to wartime financial activity.

United24 has reported billions of dollars in donations for defense and humanitarian programs. Russian officials said cooperation with such initiatives represents direct wartime support. Prosecutors also accused the exchange of facilitating illegal financial activity alongside donations.

The action coincides with increased international scrutiny of crypto activity tied to Russia. The European Union recently approved its nineteenth round of sanctions against Moscow. The sanctions include action against A7A5, a ruble-backed stablecoin linked to the Russian state.

At the same time, Russia has expanded its own use of cryptocurrencies. Reuters reported that Russia has used crypto to facilitate oil trade with China and India. The report cited sources familiar with the transactions. Officials said crypto payments help bypass Western financial restrictions.

Exchange Maintains Exit From Russian Market While Growing Abroad

WhiteBIT said it exited the Russian market in early 2022 after the invasion began. The exchange stated that it blocked Russian and Belarusian users at that time. It also restricted access for users in temporarily occupied Ukrainian territories. The company removed ruble trading pairs from its platform.

Meanwhile, WhiteBIT recently opened offices in New York. It launched a trading platform focused on the United States market. The company promoted the launch with a Times Square marketing campaign. WhiteBIT also expanded operations across Australia, Argentina, and Brazil.

The broader crypto sector has also faced enforcement outside Russia. Authorities from the United States, Germany, and Finland recently seized Garantex, a Russian-based crypto exchange. The U.S. Department of Justice said the platform facilitated ransomware payments and darknet market activity.