Russian Citizen Jailed for Using Crypto to Fund Ukrainian Armed Forces

• A Russian citizen was sentenced to 7 years for using cryptocurrency to fund Ukrainian Armed Forces.
• The individual transferred funds to Ukrainian forces via crypto wallets following instructions from a terrorist group.
• Russia’s cryptocurrency adoption expands with proposed Bitcoin reserves and legislative changes amid Western sanctions.

A Russian citizen has been sentenced to seven years in a maximum-security penal colony for using cryptocurrency to financially support the Ukrainian Armed Forces, marking the first publicly known case in Russia of digital currency funding a military organization.

Russian National Sentenced for Crypto-Funding Ukrainian Forces

A resident of the Mirninsky District in Yakutia has been convicted for transferring cryptocurrency to a unit of the Ukrainian Armed Forces (AFU). This unit reportedly utilized the funds for reconnaissance and subversive operations targeting Russian security interests. According to the FSB Directorate for the Republic of Sakha (Yakutia), the sentencing took place on January 14.

The convicted individual, who worked for a diamond mining company, was found to have joined a terrorist organization’s group on a social network. Ukrainian operatives provided the individual with specific instructions on transferring funds to a designated cryptocurrency wallet. The financial contributions were linked to activities that supported Ukrainian military operations against Russia.

This case follows another incident reported on January 10 involving a resident of Yenakiyevo in the Donetsk People’s Republic. The individual was detained on charges of treason for allegedly transferring money to electronic accounts funding Ukrainian Armed Forces personnel. These funds were reportedly used to support military operations.

Russia’s Expanding Use of Cryptocurrencies

In a broader context, Russia has been increasingly embracing cryptocurrency as part of its financial strategy. In December, State Duma deputy Anton Tkachev proposed creating a strategic Bitcoin reserve. This aligns with legislative changes that allow domestic firms to use cryptocurrencies for international payments. These adjustments aim to mitigate the effects of Western sanctions.
President Vladimir Putin has previously acknowledged the resilience of Bitcoin and other cryptocurrencies against global regulation. He linked their growing prominence to the declining role of the U.S. dollar as a reserve currency due to its political application.