There's a crypto turmoil in Georgia. British schoolboy Alexander Browder exposed a whole network of crypto platforms used by Russia to bypass sanctions, with Georgian crypto exchanges playing a significant role. The diligent schoolboy turned out to be the son of William Browder, the initiator of the Magnitsky Act. Russia immediately imposed sanctions on the boy for tarnishing its international image. Meanwhile, Georgia is attempting to cleanse its crypto reputation before the Western world and tame its domestic crypto market. Alongside a successful joint operation with European law enforcement to expose a cybercrime network based in Adjara, the authorities decided to crack down on crypto-anarchy in Svaneti. The Svans swear on icons that they will not mine anymore, yet they continue to do so. Iya Barateli has pieced together the fragments of this crypto-detective story. A visitor examines a model of a cryptocurrency mining farm during the Blockchain Forum 2026 in Moscow, Russia, April 15, 2026. Photo: Maxim Shipenkov / EPA. New sanctions for Georgia from London and Brussels In the coming days, the European Union intends to include Georgian cryptocurrency platforms in the 21st package of sanctions against Russia. This was reported by the Financial Times, according to which Europe suspects a number of Georgian-registered crypto companies of facilitating Russia's circumvention of sanctions. Earlier, at the end of May, the UK government imposed tough sanctions on crypto platforms linked to the Russian payment network 'A7', which, according to the Foreign Office, was used to support the Russian military economy. "Over 90 billion dollars were transacted through this network last year alone – a sum equal to half of Russia's annual military spending. London imposed sanctions on 18 platforms – these are crypto platforms, banks, and financial networks in Russia, the UK, Georgia, Kyrgyzstan, the United Arab Emirates, Panama, and El Salvador, which, according to the UK Foreign Ministry, were used as "shadow financial systems" to circumvent anti-Russian sanctions. The assets of these companies are frozen, and British organizations have stopped working with them. Three crypto exchanges from Georgia were included in the sanctions list: Arvix LLC, Rapira Group LLC, and Aifory LLC. "We are also taking measures against three Georgian companies that operate Russia-oriented exchanges and are trying to circumvent sanctions," the UK government statement said. A 17-year-old British schoolboy, Alexander Browder, helped identify the Russian shadow cryptocurrency laundering network. He is the son of the well-known British financier William Browder, the chief initiator of the Magnitsky Act, passed in the US in 2012, which provides for visa and financial restrictions against high-ranking Russian officials involved in human rights violations. Alexander Browder. Photo: X social network. As early as March, Alexander Browder published a report for the Henry Jackson Society think tank, in which he described illegal schemes for transferring funds through cryptocurrency and emphasized that the ruble-backed stablecoin known as A7A5 represents "one of the most serious challenges facing the West" in the fight against money laundering by sanctioning regimes. According to Browder, a number of countries, including Russia, Iran, and North Korea, have "laundered" about 350 billion dollars this way. When it became known that the UK government had consulted with Browder, the Russian Foreign Ministry took retaliatory measures: on June 2, Moscow announced that it was banning Alexander Browder and four other British citizens from entering Russia for "slanderous fabrications and false information." "Any attempts by British political elites to incite Russophobia, deliberately damage our country's international image, and increase anti-Russian sanctions will be met with decisive retaliatory measures," the Russian Foreign Ministry stated. However, the British schoolboy made it clear in posts on X that he is not at all concerned about being banned from visiting Russia: "I am proud to be the first schoolboy in the world to be sanctioned by an authoritarian regime for exposing corruption. /.../ I have identified their Achilles' heel. Without A7A5, they would not be able to finance their aggressive war." Reaction to sanctions: fast, but still too late The very next day after the UK announced sanctions, Tbilisi made it clear that they were not only not surprised but had already taken measures. The Investigative Service of the Georgian Ministry of Finance officially stated that companies Aifory, Arvix, and Rapira Group were already under investigation, which concluded that Aifory and Arvix were registered to straw men for money and had no offices or property in Georgia. As for Rapira Group, according to the investigation, this company was registered by a UK citizen under a power of attorney, and no financial transactions were recorded on its accounts; it also had no offices or assets in Georgia. Rapira exclusively served Russian citizens through the website rapira.net with a Russian registrar. The Ministry of Finance reported that a month before the sanctions were imposed, specifically on April 28, 2026, a court had already ruled, fining two company executives 30,000 lari (about $10,000) and sentencing the organizer of the fraudulent scheme, one David Dzhinchara dze, to a real prison term of 9.5 years. In reporting this, the Georgian Ministry of Finance emphasized that they continue to cooperate with international partners on cases related to sanctions circumvention. Furthermore, it was allegedly the National Bank of Georgia itself (not some British teenager) that identified the illegal transactions, and the British side was notified. Nevertheless, the opposition raised many questions, mainly concerning why the investigative bodies did not publicly inform the public about the investigation into such an important case. Georgian Parliament Speaker Shalva Papuashvili was clearly caught off guard by journalists. "I don't know exactly what the communication was," he evasively replied to a direct question about whether the National Bank of Georgia had provided London with information about the facts of money laundering for the benefit of Russia. Tbilisi, Georgia, May 28, 2026. Photo: Moe Zoyari / ZUMA Press Wire / Scanpix / LETA. New police operation Meanwhile, there was obviously some communication with the Europeans, and not all the credit will go to the British teenage crypto-exposer. On June 11, the Prosecutor General's Office, the Ministry of Internal Affairs, and the Ministry of Finance of Georgia reported their participation in a large-scale international operation to uncover a network for laundering illegally obtained money through cryptocurrency, operating since 2022. The volume of laundered assets is estimated at several hundred million dollars. The platform in question is AudiA6 – a "crypto mixer" that, for a high commission, helps hide traces of suspicious cryptocurrency transactions. "It is assumed that it was through AudiA6 in April 2026 that 9.5 million dollars, stolen from more than 50 users through the fake Ledger Live application, were legalized. This is software for managing virtual wallets, which scammers managed to place in the official Apple store by bypassing verification systems. In addition, the criminal group manages the Dark2Web internet forum, where cybercriminals from different countries offer their services. EU agencies Europol and Eurojust were responsible for coordinating the operation. In addition to Georgian investigators, employees of the US Secret Service, the Central Bureau for Combating Cybercrime of Poland, and the Prosecutor's Office of the city of Lodz were involved. According to official data, about 100 investigators and operatives conducted searches at dozens of addresses in Georgia: in residential buildings, offices, and cars. In Adjara, two foreigners were detained (the investigation did not disclose their citizenship), and electronic media and documents were seized. In addition, property acquired by alleged participants in the scheme for the purpose of legalizing proceeds of crime was seized: 173 vehicles, expensive real estate, and funds in bank accounts. Crypto from the Svaneti Mountains In Georgia, income from the sale of cryptocurrencies is not taxed, and operations with digital assets are completely legal. Large-scale industrial mining is concentrated not only in private farms but also in free industrial zones, primarily in Gldani (a district of Tbilisi) and Kutaisi. Residents of such zones operate under a special tax regime: for permitted activities within the zone, there is exemption from profit tax, VAT on operations within the zone, property tax, and import duties. The Tbilisi Free Industrial Zone itself lists ensuring electricity supply without VAT among its advantages. The Gldani hub grew around the Bitfury project: in 2015, the company received 18 hectares of land in Gldani for a symbolic price, the territory received the status of a free industrial zone, and in 2016, a 40-megawatt data center was built there. Tbilisi, Georgia, October 28, 2025. Photo: Irakli Gedenidze / REUTERS / Scanpix / LETA. The Bitfury project is associated with the circle of Georgia's shadow ruler Ivanishvili in Georgian political polemics. It is known that the Georgian Co-Investment Fund, established by Bidzina Ivanishvili, provided Bitfury with a $10 million loan in 2014 for the first data center in Gori. However, Forbes Georgia later wrote that the fund does not own stakes in any of Bitfury's data centers. And against this prosperous crypto background, the authorities decided, for the first time in many years, to finally deal with the overwhelming volume of mining in Svaneti. Residents of this small but extremely picturesque mountainous region of Georgia have officially enjoyed benefits for over 20 years – they don't pay for electricity. There are several reasons for this: the simple poverty of the highlanders, and the authorities' reluctance to spoil relations with them over the installation of meters. It was assumed that the benefits would help develop tourism in Svaneti, but local residents found an even more profitable use for free electricity: it is believed that today there are about 10,000 crypto miners – devices for extracting virtual money – operating in the region. Thanks to liberal laws, Georgia currently ranks first in the South Caucasus and is among the top 10 countries globally in terms of ease of access to mining. However, due to mining abuses in Svaneti, both local tourism and the country's economy as a whole are suffering. According to specialists' estimates, under normal load, consumption in Svaneti should not exceed 7-10 million kWh per year. In practice, it turns out to be several times higher: according to Energo-Pro Georgia, in 2020, the municipality here consumed 91.1 million kWh of electricity, and in 2025 – already 132.9 million kWh. The networks cannot withstand such overloads, so power outages in the Svaneti mountains are a common problem. Four years ago, when the situation became critical, one of the most unusual events in the history of cryptocurrency occurred in Mestia (the center of Svaneti): hundreds of Svans came to the Church of St. George to, according to the community custom, "swear on the icon" and promise to turn off their miners. Despite the fact that this ritual in ancient times stopped even blood feuds, it did not work with crypto, and mining in the Svaneti mountains continues to flourish. Tbilisi, Georgia, May 29, 2026. Photo: Moe Zoyari / ZUMA Press Wire / Scanpix / LETA. However, the other day, the Georgian Dream government suddenly came to its senses and announced that miners from Svaneti are robbing the energy system annually by an amount of 20 to 25 million lari (about 8 million dollars). In this regard, a war was declared on mining, and special police forces went to Mestia to confiscate equipment from local residents. The opposition, of course, did not believe in the authorities' resolve and demanded the specific names of the patrons of the Svaneti crypto farms. Critics are confident that the raids are ineffective and remind that miners are present in other regions as well, and generally consider the authorities' initiative to be a consequence of clan struggles within Georgian Dream.