How Bloomberg “unexpectedly discovered” a “crypto-laundry” in Moscow City

Bloomberg “opened the veil of secrecy” by naming one of the buildings of the IDC, “Federation Tower East”, one of the world’s largest centers for cashing out cryptocurrencies.

Numerous cryptocurrency exchangers have been operating in Moscow City for at least five years. Including, dealing with the exchange of cryptocurrencies for cash. Many of them have been working since the existence of the BTC-e exchange. But the largest business news agency in the United States has taken notice of them only now.

The agency claims, citing unnamed cryptocurrency and cybersecurity experts, that Federation Tower has more than 50 companies that convert cryptocurrencies into cash. According to Bloomberg, at least 10 of them help “Russian hackers” cash out the proceeds of criminal operations.

The topic of “Russian hackers” is experiencing a new wave of popularity in the West. Although it is known from American sources that the largest number of cyber attacks in the world are carried out from the US cyberspace, Canada is in second place. But now the turnover of cryptocurrencies in Russia has turned out to be such a hot topic that Bloomberg could not help but investigate well-known facts. It can be considered a coincidence that yesterday the FBI
announced the award in $ 10 million for information about the group of hackers DarkSide, which is unsubstantiatedly associated with Russia.

In addition, yesterday in a number of Telegram channels appeared
information on the detention on November 1 in Amsterdam at the request of the United States of a Russian citizen Denis Dubnikov. Sources associate him with the Coyotes group, which owns, among other things, the EggChange exchanger. The simultaneous information attack and arrest of the alleged launderer speaks to the seriousness of the intentions of those who launched this campaign. However, information about Denis Dubnikov’s connection with exchangers from Moscow City has not yet been confirmed.

Bloomberg claims that many of the unnamed companies in the 95-story tower neglect security measures and condone illegal activities. What’s more, Bloomberg informs readers that the Russian government may be encouraging some of the cybercrimes and therefore covering up illegal exchanges.

Bloomberg has identified four exchangers located in the East Tower, which, according to the agency, are suspected of illegal transactions in the United States: Suex OTC, EggChange, CashBank and Buy-bitcoin.pro. In September 2021, the Suex OTC OTC trading platform was indeed listed on the US Foreign Assets Control (OFAC) ‘sanctions list’ for money laundering, while the other three are allegedly under investigation in the US and Europe. Bloomberg has not provided official confirmation of the fact of the investigation into EggChange, CashBank and Buy-bitcoin.pro.

To enhance the effect, Bloomberg cites the experience of an unnamed dummy trader who, without visible problems and, most surprisingly, anonymously, exchanged cryptocurrency for fiat in one visit to the office of the exchange office in the Federation Tower East. It is allegedly possible to become a client of a crypto exchanger only on a recommendation, and a random person cannot get there. Communication with clients goes through Telegram, and transactions are concluded with personal presence at the office in the City.

On the other hand, the community is well aware that even “retail” Russian users of cryptocurrencies have been working with these exchangers for many years, carrying out exchange operations both via the Internet and for cash, without resorting to such tricks. Much in the Bloomberg article looks completely strange – for example, cashing out “dirty” money under an agreement.

Now we have to fear that the victory of the Russian e-sports team Team Spirit at the Dota 2 World Championship will create another weighty reason for Bloomberg to suspect Russia of training personnel for cybercrimes.

EggChange comment

The exchanger EggChange, which became the highlight of the program this time, gave Bits.media an extended commentary with its point of view on the situation. In particular, the exchanger denies the involvement of Denis Dubnikov in the project. The text of the commentary is reproduced unchanged.

Anyone who read the Bloomberg article could see how politicized it is. The accusations are not true. The article says that the exchanger did not respond to their requests. But we have not received any requests for comment. EggChange does not launder money from ransomware programs or any other. Each incoming transaction is checked for AML, cryptocurrency with an invalid risk score is refunded.

According to a Bloomberg article, Binance stated that it has noted several accounts and illegal flows associated with exchange platforms from Russia, including EggChange, but our exchange service does not use Binance’s services. It is interesting to see at least some data on Binance accounts associated with EggChange.

Also in the Bloomberg article it is said that the US Treasury Department, which officially imposed sanctions against other exchangers, refused to confirm the existence of an investigation into the EggChange exchange office. There was no comment or confirmation from Chainalysis that EggChange was somehow involved in the trafficking of ransomware and other illegal operators, including Hydra.

Well-known industry media Forklog has released
article, in the title of which it is written that the Russian Foreign Ministry confirmed the detention of the co-founder of EggChange. We have reviewed the information. The representative of the Ministry of Foreign Affairs commented on Facebook under the publication of Sergei Mendeleev that they are providing assistance to the detained citizen. There is no data connecting Denis Dubnikov with the EggChange exchange office. Information resources with a dubious reputation in Telegram situationally tried to connect the Bloomberg article with the detention of a citizen of the Russian Federation, who, possibly, is related to the exchange of cryptocurrencies.