European Union Targets Crypto Channels in New Sanctions Push Against Russia and Allies

In a significant escalation of financial pressure, the European Union is contemplating a prohibition on all cryptocurrency transactions with Russia to prevent the digital circumvention of sanctions.

A policy document obtained by the Financial Times reveals the strategy is focused on disabling “copycat Russian crypto entities spun out of already sanctioned platforms,” which are accused of supporting trade for the war in Ukraine.

The EU’s wider proposal additionally implicates Kyrgyzstan, linking companies in the country to the sale of dual-use electronics destined for Russian drones and weapons. The document cites extraordinary trade shifts, with imports from the EU to Kyrgyzstan growing almost 800 percent and Kyrgyz exports to Russia rising 1,200 percent since the onset of the war.

This activity, the EU concludes, “demonstrates a continuing and particularly high risk of circumvention” that the new measures aim to eliminate.