ChatEx, a cryptocurrency exchange located in Russia, relies on communication software to conduct cryptocurrency transactions, and the exchange has been found to have criminalized illegal money laundering.
The U.S. Department of the Treasury announced sanctions on the exchange and its operators, and no U.S. business or citizen can trade with it without approval.
The transaction here is not just about money transactions. Any other transaction, including but not limited to technology or service, must be submitted in advance and then approved before the transaction can be traded.
The reason for the sanctions was that the Financial Crimes Enforcement Network under the US Treasury Department discovered that the exchange provided cryptocurrency purchases and exchanges for ransomware gangs.
Despite the anonymity of cryptocurrency, it can still be tracked through on-chain data. For example, the direction of Bitcoin flow can be traced to the exchange that ultimately flows into it.
An investigation by the U.S. Department of the Treasury found that more than half of the cryptocurrency exchange’s funds had illegal problems, including but not limited to ransomware, dark web, and high-risk transactions.
The implementation of sanctions will help cut off the ransomware group’s cashing channels, which is why the U.S. Treasury Department has sanctioned many cryptocurrency exchanges.
At the same time, companies that provide infrastructure such as server support for these cryptocurrency exchanges will also be associated, which will force the exchange to shut down or make corrections.