Ukraine has lost at least $10 billion to crypto crimes, according to a report by the Royal United Services Institute (RUSI), a UK-based security think tank.
The report noted Russian networks and local criminals are exploiting gaps in Ukraine’s crypto laws, using over-the-counter trades, money mule schemes, and Telegram-based operations. RUSI warned that without urgent reform, Ukraine could become a permanent hub for crypto crime.
The report also explained that money mule networks, known locally as “drops,” may be costing Ukraine $24 million each month. Banks closed more than 80,000 mule accounts in 2024, but the schemes continue.
Meanwhile, Telegram drug sales paid in crypto also add to the threat. RUSI noted, “These services are increasingly used to circumvent international sanctions, including the procurement of dual-use components for the Russian armed forces.”
The report also highlighted that Russian actors use Ukraine to fund military procurement and launder money while spreading drugs, targeting soldiers, and taking advantage of the country’s strategic location and ongoing war.
Ukraine started regulating crypto in 2018 and passed the Law on Virtual Assets in February 2022, just before Russia invaded. However, the law has not fully taken effect because parliament must approve a separate taxation law.
Now, Ukraine must update its crypto rules to match EU standards by late 2025 and follow Financial Action Task Force rules to prevent money laundering and terrorism financing.
RUSI also advised Ukraine to attract stablecoin projects, set clear compliance rules, and recognize the thin boundary between cybercrime and illegal finance. The think tank said failure to act could allow Russia-based networks to continue exploiting Ukraine while discouraging legitimate startups.
Notably, Ukraine has made some progress by sanctioning 19 Russian crypto miners, 17 digital asset operators, and five exchanges, but RUSI warned that more action is needed.
RUSI said, “Ukraine, while not the origin, is seen as an emerging hub for laundering crypto funds due to its strategic location, wartime vulnerabilities, and evolving regulations.”
That said, this report paints a clear picture that Ukraine risks losing both economic opportunity and national security if it does not reform crypto laws and enforcement quickly.
Without urgent measures, the country may continue to face billions in losses while struggling to protect its financial system.
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