Russia Accounted for 40% of Global Illicit Crypto Transactions in 2020

According to analysts, Russia became the leading jurisdiction for cryptocurrency exchange and trading platforms with low verification standards in 2020. For example, LocalBitcoins, a Finland-based platform, facilitates currency trading for Bitcoin. Users post ads on the site specifying exchange rates and payment methods for buying or selling Bitcoin. Although LocalBitcoins is blocked in Russia, data from the platform shows that 17.4% of its users last year were Russian residents.

“Russia leads the top five most popular jurisdictions for both Ethereum and Bitcoin. This may be linked to the overall popularity of prohibited services in Russia, such as Hydra,” the company’s research notes.

Analysts calculated that Russia’s share of the global market for illicit crypto transactions was 41.1%. Ukraine’s platforms accounted for 6.54% of darknet transactions, the United Kingdom for 2.8%, and Germany for 1.87%. The share attributed to “unknown countries” was 24.6%, while “other” countries made up 23.1%.

According to Clain, by the end of 2020, the number of cryptocurrency exchange users worldwide reached up to 350 million people. The volume of transactions on high-risk exchanges grew by 30% over the year, exceeding $19.7 billion. Of this, the volume of illegal transactions on these exchanges amounted to $4.2 billion, which is 16% higher than the previous year. In 2020, the share of illegal transactions on high-risk exchanges was 12 times higher than on regulated exchanges, where illegal services accounted for just 1.7% of transactions.