Russia just blacklisted 2,600 crypto wallets while using crypto to dodge its own sanctions

The Bank of Russia is building a surveillance apparatus for digital assets at the same time the Russian state relies on those assets to circumvent Western financial restrictions. The contradiction reveals how governments actually think about crypto. Summary The Bank of Russia added 2,600 crypto wallets to a monitoring system used by banks and law enforcement after more than 1 billion rubles flowed into the addresses during the first half of 2026. More than 74% of pyramid schemes identified by the regulator used cryptocurrencies to attract funds, down from 84% in 2025 but still the dominant payment channel for financial fraud in Russia. Russia simultaneously uses cryptocurrency for international trade settlement to circumvent Western sanctions, with the government legalizing crypto for cross border payments in late 2024 and expanding the framework through 2025 and 2026. China, India, and Russia are all building domestic blockchain surveillance infrastructure while encouraging or tolerating cross border crypto settlement, creating a bifurcated system where crypto is monitored internally and weaponized externally. The number of entities flagged for illegal financial activity fell 31% ...