How a rouble-backed stablecoin, Tether's USDT and an alternative payments network are testing the reach of Western sanctions.
Russia's search for alternatives to the Western financial system is increasingly moving into crypto.
One experiment in particular has attracted attention: A7A5, a rouble-backed stablecoin linked to the wider A7 payments network and designed to facilitate cross-border payments outside conventional banking channels.
In this episode of the Suspicious Transaction Report, host Tom Keatinge speaks with Dr Tom Robinson, Chief Scientist and Founder of blockchain analytics company Elliptic, about what A7A5 reveals about the evolution of sanctions evasion.
They explore the relationship between A7A5, Ilan Shor, Russian state-owned bank PSB and Kyrgyzstan; why the token itself is only part of a much wider financial infrastructure; and how A7A5 can act as a bridge from roubles into the globally liquid dollar-backed stablecoin USDT.
The conversation also considers whether sanctions are working. Blockchain data shows how enforcement can restrict liquidity and disrupt crypto infrastructure — but also how rapidly networks adapt.
Ultimately, the episode asks where policymakers should focus next: on individual tokens, or on the exchanges, liquidity providers and exit points that make alternative payment systems usable.
Further reading
- The Putin Tax and the Cost of Russian Hostility to Britain – Tom and Graeme Downie MP reflect on the cost of Russian hostility for Britain, arguing that the Government must justify its choices.
- Could Stablecoins be the Future of Payments and Financial Integrity? – Tom and Arzu consider the role of stablecoins and the ways policymakers can more effectively govern this growing payment rail.
- Enhancing the EU Response to Crypto-Enabled Sanctions Circumvention – Tom and Kinga argue that the EU must target the infrastructure that allows for widespread use of crypto to disrupt Russia's sanctions-evasion networks.
- CFS has also recently launched a new taskforce to consider the implications for national security of the use of cryptoassets. Find out more here.
