Russia-Linked Stablecoin A7A5 Raises Questions at Token2049

Ruble backed stablecoin A7A5 sponsored Singapore's largest crypto event, raising concerns about how financial sanctions can become blurred across different jurisdictions, due to its connection with a sanctioned Russian bank.

Last Friday, former White House Crypto Policy Director Bo Hines took the stage at the Token2049 event to praise Tether’s stablecoin. Hines received significant support from attendees while stating that Tether is a guarantor of the hegemony of the U.S. dollar. However, a few hours later, A7A5's regulatory and international affairs director Oleg Ogienko took to the stage with a distinctive message for the audience.

A7A5 is a stablecoin issued by Old Vector and used on the payment platform A7 LLC. This platform is designed to help circumvent sanctions. The stablecoin is supported by Promsvyazbank (PSB), a financial institution that is sanctioned in many countries, including the U.S. and the United Kingdom. Following the invasion of Ukraine, Singapore deviated from its long-standing neutrality and joined Western sanctions.

On March 14, 2023, the Monetary Authority of Singapore (MAS) issued a notice prohibiting financial institutions in Singapore from engaging with Promsvyazbank. However, the Token2049 event was organized by BOB Group, based in Hong Kong, which follows China's lead on sanctions. Therefore, while BOB Group acted within local law, other sponsors expressed concerns that their association with A7A5 could harm their brand.

Many companies described A7A5’s presence at the event as a “compliance nightmare,” while others considered being associated with it a “heart attack.” The BOB Group removed information about A7A5 from the sponsor list; however, A7A5 continues to promote itself as an official sponsor via social media.

Bitcoin surpassed a historic peak of $125,000 amid concerns about U.S. government shutdown and increased demand for safe assets. Ethereum is trading around $4,500, garnering attention ahead of the Fusaka upgrade scheduled for December. Gold is also trading above $3,880, as investors continue to seek safe havens.