Tether is actively used by Chinese merchants to withdraw cash earnings from Russia

The head of one of these platforms said that they sell $3 million in cryptocurrency a day on average, most of which is usually sent to China. Bitcoin accounts for about 20% of the volume of transactions, while 80% of the funds received are transferred to USDT.

According to some Moscow over-the-counter traders, the volume of transactions with USDT initiated by Chinese importers reaches $10-30 million per day.

They accumulate a large amount of cash in Moscow, and then they need Tether to withdraw money to China," said Maya Shakhnazarova, head of over-the-counter trading at Huobi Russia. - The client comes with cash, we register the price on the stock exchanges. The client sends cash and the address of the wallet, the seller sends USDT to the wallet.

Chinese importers in the grey market used Bitcoin before the decline in 2018, another OTC-dealer said. While prices continued to rise, intermediaries helped them purchase cryptocurrency, which allowed them to increase their revenue. However, the use of Bitcoin for such transfers became too risky in 2018.

"When prices went down, it became much more convenient to use Tether. China relies entirely on the USDT, they trust it, and it is also very liquid," the source said.

Despite the restrictions on trading in cryptocurrencies in China, local traders can still withdraw assets from the USDT to the yuan through over-the-counter markets served by, for example, Huobi and OKEx.

However, they are not concerned about the possibility that Tether may not have sufficient reserves to cover all of the USDTs in circulation. OTC traders pay attention to the fact that the average daily trading volume of USDT is several times higher than the capitalization of the instrument, as evidence that people use the same tokens to convert assets several times a day. Thus, on July 29, the 24-hour trading volume of USDT amounted to $17.5 billion with its own capitalization of $4 billion.

USDT allows you to quickly convert capital, so that used to use it traders do not have to think how much staplecoin will cost tomorrow. Large amounts of USDT are almost instantly transferred to China, where they are then converted to RMB, say representatives of the cryptocurrency business in Moscow.

Cryptocurrencies also attract Chinese traders because local authorities have tightened capital controls and limited the amount of foreign currency available for purchase or sale per person to $50,000 per year. Citizens can apply for an increase in the quota, but it will still be limited.

Last April, Yuri Polupanov, Director of the Financial Monitoring and Currency Control Department of the Bank of Russia, according to RBC, said that the monthly turnover of retail shadow trade was about 600 billion rubles per month. It is estimated that 90% of the retailers in this market are Chinese manufacturers and traders.

"We hardly see any bank deposits," Polupanov said. - We see the acquisition of a majority of the cryptocurrency's revenues, which is not accounted for anywhere at present. We see the instant direction of cryptocurrency by e-mail directly to the home country of these traders and producers and its conversion into local currency.