Analysis shows link between Copper Technologies and Jonatan Zimenkov, who was later hit with US sanctions over Ukraine invasion
A cryptocurrency firm transferred digital assets worth more than $4.2m to a crypto wallet belonging to a member of an alleged Russian arms-dealing network who was later hit with US sanctions, it can be revealed.
Details of the transactions involving Copper Technologies raise questions about whether UK laws governing crypto have adapted quickly enough to keep pace with a rapidly evolving sector that has come under increasing scrutiny over the level of anonymity it can provide.
Analysis of crypto records by the Guardian and the International Consortium of Investigative Journalists (ICIJ) highlights a connection between one of the most prominent cryptocurrency companies and Jonatan Zimenkov, an Israeli-born Russian national.
Zimenkov, 29, was subjected to US sanctions in February 2023 for allegedly assisting the Russian military with the invasion of Ukraine, as part of the “Zimenkov network” – an arms-dealing and sanctions evasion network headed by his father, Igor Zimenkov.
Records show Copper transferred millions of dollars worth of digital currency in May 2021 to a wallet that has since been identified as belonging to Jonatan Zimenkov. Sanctions were imposed on him 19 months later. Copper, which recruited the former chancellor of the exchequer Philip Hammond, as an adviser in October 2021, was based in London at the time of the transfer, but has since moved to Switzerland.
While Zimenkov was not subjected to sanctions when the transaction took place, the US Treasury department’s Office of Foreign Assets Control (OFAC) has said it believes the network had been active over several years by the time it imposed restrictions on 22 individuals and entities in multiple countries.
In its citation, it said the Zimenkov network had been involved in multiple deals for Russian cybersecurity and helicopter sales abroad, as well as attempts to supply weapons to an unnamed African country.
There is no suggestion that Copper breached any sanctions or any other regulations in place at the time of the transaction.
However, the revelation shines a light on the opaque world of cryptocurrency and the anonymity it can offer, as well as raising questions about how digital assets and transactions involving them should be regulated within the wider financial system.
