Russia's Sanctioned Exchange Will Sell Tether's USDT From December 1, and Buyers Carry the Freeze Risk

Russians will soon be able to buy a dollar stablecoin on the same screens they use for Sberbank and Gazprom shares. Moscow Exchange plans to open trading in bitcoin, ether and Tether's USDT on December 1, the exchange announced, the first organized crypto market in the country under a new digital currency law that took effect in September.

Trading will run from 06:50 to 23:50 Moscow time, matching stock market hours, with same day and next day settlement and swaps for liquidity. The National Clearing Centre will clear every trade. The launch starts with pilot deals, and brokers will join as they are ready.

A sanctioned venue for a token that obeys sanctions

The catch is who sits in the middle. The US Treasury blocked both Moscow Exchange and the National Clearing Centre in June 2024, as CoinDesk noted. Tether, which issues USDT, freezes wallets tied to addresses on the Treasury's sanctions list, and it already faces pressure in Washington over how its token is used.

Bitcoin and ether have no issuer that can blacklist a holding. USDT does. Buyers on the exchange will not hold the coins in their own wallets either. The tokens sit with a digital depository that works with the exchange, so a single frozen address could lock the balances of many clients at once.

Who pays if Tether freezes

Russia's finance ministry has already answered that question, and the answer is the buyer. Deputy Finance Minister Ivan Chebeskov said in September that a digital depository is liable for its own record keeping and custody, but that losses caused by people subject to foreign law fall on the investor. If a foreign issuer blocks an asset for reasons outside the depository's control, the depository does not have to compensate the client.

His answer to that risk is the entry test. Ordinary investors must pass one and can buy no more than 300,000 rubles of crypto a year, about $3,700, through a single broker. Qualified investors also take a test but face no cap.

Moscow Exchange has not explained publicly how it would handle a USDT freeze, which wallets will hold client coins, or whether Tether has any role in the launch. For now, the people taking that risk are the ones who pass the test.

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