Russian tech entrepreneur Sergey Mendeleev, known for his involvement in various crypto ventures, has launched a project called Exved. Announced on December 7, 2023, on Telegram, Exved is a Russian crypto payment platform for “importers and exporters” that facilitates exchanges between Tether (USDT), rubles, and the dollar. Mendeleev is also the co-founder of the OFAC-sanctioned crypto exchange Garantex.
Exved’s Inception and Association with InDeFi Bank
Exved‘s launch (website) seems to be a collaborative effort with InDeFi Bank, another of Mendeleev’s ventures. InDeFi Bank, a Russian banking entity, appears to be closely intertwined with Exved‘s operations. Mendeleev, a recognized figure in the crypto world, is also the founder of the crypto exchange Garantex.
On its website, Exved promises that “any relations both between the Exchange and counterparties are commercial secrets and are protected by the laws of the Russian Federation.” However, no further details are provided about the operating legal entities.
However, Garantex‘s reputation is marred by controversies, notably being sanctioned by the Office of Foreign Asset Control (OFAC) for its alleged involvement in money laundering activities. In Feb 2022, the Financial Intelligence Unit (FIU) of Estonia revoked Garantex‘s crypto license due to these allegations.
Garantex and Its Darknet Connections
Garantex, under Sergey Mendeleev‘s leadership, was identified as one of the largest counterparties of the infamous Hydra darknet market. U.S. OFAC’s announcement highlighted the revocation of Garantex‘s Estonian license, citing “critical AML/CFT deficiencies” and connections to wallets used for criminal activities.
Read all Garantex reports here.
Exved’s Compliance Claims and Mechanisms
Despite the controversies surrounding its sister company, Exved professes to operate strictly with legal and compliant entities, focusing on importers and exporters. Mendeleev, in a now-deleted CoinTelegraph article, claimed that Exved‘s mechanics had received approval from the Bank of Russia.
InDeFi Bank: The Backbone of Exved
InDeFi Bank, where Mendeleev serves as chief executive, brings experience in the stablecoin ecosystem, notably working on a tokenized ruble. Intriguingly, InDeFi Bank is co-led by Alexander Lebedev, a former KGB agent, adding another layer of complexity to the firm’s operations.
The Role of USDT in Russian Cross-Border Transactions
USDT has been a critical tool for cross-border currency flows in Russia for years. In 2019, substantial amounts of USDT were transferred across the China-Russia border daily, with crypto exchanges like Huobi highlighting USDT’s effectiveness for Chinese firms sending the value back to China.
Potential Implications for US Law Enforcement
With Tether recently increasing US law enforcement’s access to its infrastructure, the launch of Exved, a Russian firm managing cross-border payments and linked to executives of sanctioned entities, could draw significant attention. This development might pose new challenges and opportunities for monitoring and regulating digital currency flows, especially in the context of international sanctions and anti-money laundering efforts.
Conclusion
As Exved steps into the spotlight, its association with figures and entities embroiled in controversies could cast shadows on its operations. The crypto community and regulatory bodies will likely watch closely how this venture navigates the complex terrain of international finance, compliance, and digital currencies.
If you have information about Garantex, Exdev, or Sergey Mendeleev, please share it via our whistleblower platform, Whistle42.
