Russians are turning to Crypto firms in the UAE to liquidate billions of dollars of virtual currency as Russians seek a safe haven for their fortunes, company executives and financial sources said.

In a recent article written by Reuters, it states that some clients are using cryptocurrency to invest in real estate in the UAE, while others want to use firms there to turn their virtual money into hard currency and stash it elsewhere, the sources said.

One crypto firm has received lots of queries in the past 10 days from Swiss brokers asking to liquidate billions of dollars of bitcoin because their clients are afraid Switzerland will freeze their assets, one executive said, adding that none of the requests had been for less than $2 billion.

“We’ve had like five or six in the past two weeks. None of them have come off yet – they’ve sort of fallen over at the last minute, which is not rare – but we’ve never had this much interest,” the executive said, adding that his firm normally receives an inquiry for a large transaction once a month. We have one guy – I don’t know who he is, but he came through a broker – and they’re like, ‘we want to sell 125,000 bitcoin’. And I’m like, ‘what? That’s $6 billion guys’. And they’re like, ‘yeah, we’re going to send it to a company in Australia’,” the executive said.

Dubai, the Gulf’s financial and business centre and a growing crypto hub, has long been a magnet for the world’s ultra-rich and the UAE’s refusal to take sides between Western allies and Moscow has signalled to Russians that their money is safe there.

One real estate broker, whose company has partnered with a cryptocurrency service to help people buy property, said: “We’ve been seeing a lot of Russians and even Belarusians coming to Dubai and bringing whatever they can bring, even in crypto.”

A financial source in the UAE confirmed that Russians were buying property in Dubai, using crypto as a way of getting their money out of other jurisdictions and into the Gulf state.

Cryptocurrency exchanges have said, while giving few details, that they are blocking the accounts of Russians sanctioned by the West over Moscow’s invasion of Ukraine, which Russia calls a “special operation”. Major exchanges such as Coinbase Global Inc (COIN.O) and Binance say they are taking steps to ensure that crypto is not used as a vehicle to evade sanctions, and that they collaborate with law enforcement on the issue.

Three Western diplomats said they were increasingly alarmed by the number of Russians who in recent weeks were seeking a refuge in the UAE for their fortunes, including in property, and were wary that some could be acting on behalf of those under sanctions.

Two of the diplomats said they were sceptical that the UAE would crack down on Russian wealth in the Gulf state, which they said was predominantly held in Dubai, citing the country’s neutral stance in the conflict. A third said they hoped the UAE, which is also a gold trading hub, understood the implications for its reputation and would take action.

The UAE was put on a “grey list” this month for increased monitoring by financial crime and money laundering watchdog the Financial Action Task Force (FATF). The FATF cited risks in certain industries, including real estate agents and precious metals dealers.

Dubai adopted a virtual assets law and established a regulator. The UAE’s regulator said it was close to issuing regulations and has consulted on money laundering risks in the sector. 

Two sources familiar with the matter said UAE companies had reputational concerns about doing business with Russians, but felt the state’s abstention at the U.N. Security Council, when Russia vetoed a resolution condemning its invasion of Ukraine, was a signal they should not impose restrictions on Russians.

Apurv Trivedi of Healy Consultants, which advises on setting up businesses, including crypto companies, said they had definitely been getting more interest from Russian clients.

“They’re basically trying to protect themselves against the inflationary pressures that are happening against the Russian currency. So crypto has been a very good exit for them to manage the risks that they’re facing,” Trivedi said. “It’s a good liquidity provider for them.”

Healy’s Sami Fadlallah said a lot of the money coming from Russia has been moving into Dubai’s real estate, citing both industry talk and their company’s experience.

“People parking their money in dozens of apartments in the Marina, Downtown,” Fadlallah said.

“We’ve seen a lot of Russians hedging their bets against the devaluation of the rouble by moving a lot of assets into crypto. And the UAE is relatively loose in terms of its regulation and authorities over transferring crypto here.”

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