European Union Drafts Plan to Halt Crypto Transfers to Russia Amid Sanctions Evasion Concerns

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A draft proposal within the European Union calls for a comprehensive ban on cryptocurrency transactions involving Russia, targeting the Kremlin’s suspected use of digital assets to bypass sweeping economic sanctions.

According to a document obtained by the Financial Times, the initiative seeks to close vulnerabilities by blacklisting “copycat Russian crypto entities spun out of already sanctioned platforms” that enable trade for Russia’s war effort.

The scope of the potential sanctions expansion also includes Kyrgyzstan, where the EU alleges companies have funneled dual-use electronics for military use to Russia.

The supporting trade figures are dramatic, showing imports from the EU to Kyrgyzstan up by almost 800 percent and the latter’s exports to Russia increasing by 1,200 percent since the invasion of Ukraine. EU officials characterize this pattern as clear evidence of a “continuing and particularly high risk of circumvention” of existing punitive measures.