Russia’s desperate war on VPNs explodes in their face, leaving millions unable to access their money after this bizarre turn

Russia’s aggressive efforts to block Virtual Private Networks, or VPNs, have reportedly backfired spectacularly, causing a widespread banking disruption that left millions unable to access their money. Telegram’s founder and CEO Pavel Durov announced that the government’s “blocking attempts” against VPNs “just triggered a massive banking failure; cash briefly became the only payment method nationwide yesterday,” as reported by Gizmodo.

This isn’t the first time Russia’s heavy-handed government interference with the internet has caused unexpected chaos. It’s become a fairly common occurrence for online services to suddenly stop working as the Russian government tries to prune away something it dislikes, often causing significant collateral damage in the process. The recent incident seems to be a direct consequence of what commentators have dubbed the “Great Crackdown” on digital freedoms.

Just late last month, Russia’s digital minister, Maksut Shadayev, explicitly announced an effort to “reduce VPN usage.” This move was openly stated on Max, which is Russia’s official everything app, designed to centralize digital life within the country. What’s particularly concerning about Max is its apparent lack of encryption or privacy protections, meaning the government can easily see what users are doing.

In a transparent move to push more users onto Max, Russia essentially deleted WhatsApp and Telegram from its localized version of the internet back in February

VPNs are crucial tools for many, allowing users to bypass geographic blocks and access services by routing their internet traffic through network nodes located in other countries. Think of it like taking a secret tunnel to get where you want to go online, even if the main road is blocked. Millions of Russians rely on these services daily to navigate around the country’s increasingly strict internet controls and censorship.

Amid this intensified effort to weaken VPNs, Friday saw widespread disruptions to banking apps, according to reports from various Russian media outlets. These disruptions were likely “caused by an overload in the filtering systems run by Russia’s communications watchdog,” as experts have warned that major restrictions on internet traffic can seriously undermine network stability.

Durov, who is Russian by birth but also holds passports from Saint Kitts and Nevis, the United Arab Emirates, and France, has consistently characterized Russia’s crackdown on Telegram as a massive failure. He claims that, despite all the government’s efforts, a staggering 50 million Russians still use Telegram every single day, largely thanks to VPNs. This really highlights the resilience of users and the effectiveness of these tools in circumventing censorship.

The government’s attempts to control online communication and information have escalated significantly. Following the 2022 invasion of Ukraine, Russia implemented some of the most repressive laws seen since the Soviet era. These laws have mandated censorship and significantly bolstered the influence of the Federal Security Service, which is the main successor to the Soviet-era KGB. In recent months, the state has gone even further, moving beyond simple website blocks to actively disrupt major messenger services like WhatsApp and Telegram. They’ve also repeatedly jammed mobile internet in Moscow and other cities and regions, creating a truly frustrating experience for citizens.

The Kremlin’s official line is that foreign platforms have failed to comply with Russian law, and that mobile internet restrictions are necessary to counter mass Ukrainian drone strikes. However, the reality on the ground suggests a broader effort to control information flow. The digital minister, Shadayev, has stated that his ministry is trying to impose these limits with “minimal impact on users,” which seems ironic given the recent banking fiasco. He also mentioned that decisions had been made to restrict access to a number of unidentified foreign platforms without providing any specific details.

This isn’t Russia’s first rodeo with trying to block Telegram. Back in 2018, an earlier attempt to crack down on the messaging app reportedly produced very similar results. Russia apparently sought backdoor access to Telegram messages, but they were thwarted by the app’s robust on-device encryption. This means it’s practically impossible to crack a device without physically having it in your hand.

During that earlier attempt, Russian internet users “experienced major disruptions with online payments, games, even so-called ‘smart homes’ while Telegram lost an estimated 3 percent of its Russian audience.”

The scale of the government’s efforts is pretty immense. By mid-January, Russia had blocked over 400 VPNs, which is a 70% increase compared to late last year. But it’s truly a game of cat and mouse. As soon as the authorities manage to take down one VPN service, another one pops up to take its place. Reports indicate that many young Russians are constantly changing their VPNs, sometimes even daily, just to stay connected and access the information they need.