A Journey To Moscow’s Hidden Offline Crypto Markets
Moscow’s hidden offline crypto markets are thriving. Russian journalist Alena Suharevskaia recently published a piece on Moscow’s underground crypto markets. Hundreds of secret deals are being made in offices, clothing stores, and large supermarkets. Buyers have the chance to remain anonymous and bring serious money into the market.
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Daily Trading at Moscow’s Hidden Offline Crypto Markets
While the Russian government is focused on arresting rioters on the streets and VK reposters, the heavenly side of Moscow thrives in the beautiful crypto space. Why go outside to protest against oppressive laws when you can simply remain in the shadows and work for the crypto movement?
In the Business center of “Moscow City”, Suharevskaia has found several crypto exchanges. One is called “Corporation Golden Eagle” (otherwise known as Berkut). It was opened by a former professional CSKA basketball player. CEO Denis Polokhin himself guarantees the safety and confidentiality of any deals.
The daily volume at this one location averages over 100 BTC (around $650,000 USD). Deals are closed only when a client observes for himself that the crypto coins have been sent to his wallet. Sometimes, daily trading can reach $2 million.
Oligarchs, Guns, and Money
The exchange works offline only. Clients come into the office bringing cash and documents proving the cash is legal. Exchange operators count the money, while the client can rest in a fashionable hall with leather sofas, large TV sets on the walls, game pad controllers, and even mining rigs.
To exchange large sums they need at least 30 minutes–the time it usually takes for a bitcoin or altcoin transaction to confirm on the blockchain. Polokhin often calls for a security officer and they quickly look in the databases to see whether the client is a criminal or not. If you sell cryptocurrency, they won’t be asking you for any documents.
This type of crypto exchange can be called pseudonymous, since the exchange buyers see the clients. However, Polokhin states that his clients are always big sharks with guns and personal guards. Despite the 90s feel to the market, Polokhin talks to serious men as equals and kindly asks for the appropriate documentation. Checking a client’s ID is also required to avoid dealing with criminals. No information is stored.
The International Crypto Center
The International Crypto Center is also located in the Moscow City business center. It is on the first floor of the City of the Capitals. Roman Krayniak, CEO of the organization, said that their spot is fully legal because it’s a subsidiary of the Estonian “Aridika Asset Management”. In Estonia, authorities give crypto businesses legal rights and freedoms.
Many outlets blindly repost this information despite the Estonian State Company Registry showing no results for their names. At the same time, the Aridika official site found with DuckDuckGo features a Moscow office as the main office on their Contacts page.
The exchange admin told journalists that a year ago there was a river of clients flowing through the hallways. Nowadays, only a dozen or so people use the service daily. Krayniak states that at least half of them are buying tokens to finance the development of ICO projects.
The other group of buyers are Chinese traders from the clothing shops of Moscow, accounting for around 30 percent of all volume. That money is sent to Hong Kong.
The last two groups are tricky resellers and net-traders, both representing ten percent of trades. Anonymity is respected here. No personal data is required. Some of the exchanges are hard to find, because their exact address is only shown on special boards online, with no external ads near the office.
The Clothing Markets of Moscow and Transfers to Hong Kong
Thousands of logistic companies deliver goods from China. The merchants supply the Moscow City, Gardener, and South Gates trading centers with products of all kinds before they are moved to shelves around the country for sale in cash. Previously, this grey cash appeared in the hands of banks who transferred the money to Hong Kong using underground channels.
Since 2013, Russian financial authorities have started a war on corruption in the space, meaning bankers largely avoid using older transfer schemes. Instead of asking the centralized institutions for help, Chinese traders started using crypto. By safely sending money via bitcoin, clothing traders from Moscow’s bazaars wisely escape government censorship.
If you want to trade with those gentlemen too, simply visit the Gardener bazaar’s currency exchanges and ask them to lead you to the right guy who trades crypto in an unusual underground vault or office.
Every day, the Gardener exchanges cryptocurrency worth around $10 million. This is equal to that of Moscow City. Yet, the head of the financial monitoring department of the Russian Central Bank, Yurii Polupanov stated that Moscow’s hidden offline crypto markets have around $8.6 million daily in trading volume. At the same time, the managing partner of the Crypto Center suggests a daily volume of around $7 million.
Other Bitcoin Exchange Options in Moscow
A quick web search reveals a Mosmap list of more than ten of Moscow’s hidden offline crypto markets, including phone numbers, social media contacts, and local addresses. The list features the now famous exchange Golden Eagle, mentioned above. It is not a bad decision to search for legitimate offline traders using LocalBitcoins too.
Will Moscow’s hidden offline crypto markets beat the government’s efforts at financial censorship? Let us know your thoughts in the comments section below.
Images via Maksim Stulov, Vladimir Kogan, Yandex, Jeff Fawkes