The European Commission has proposed a blanket ban on cryptocurrency transactions tied to Russia, abandoning its previous approach of sanctioning individual exchanges in favor of severing the entire crypto pipeline to Moscow.
The move, part of the bloc's 20th sanctions package announced on Feb. 6, would be the EU's most aggressive action yet against digital asset-enabled sanctions evasion.
The Financial Times first reported the proposal, citing an internal Commission document. The package targets crypto platforms, financial intermediaries, and payment channels that facilitate Russia-linked transactions.
What happened
The Commission's draft language acknowledges that listing individual crypto service providers has failed. According to the document, any further designation of specific firms "will likely lead to the creation of new companies to circumvent these listings."
Officials specifically cited Garantex - a Moscow-linked exchange sanctioned by Washington in 2022 - as a case study in futility.
After a multinational enforcement operation seized Garantex's domains in March 2025, its operators launched a successor platform, Grinex, which processed billions of dollars in crypto within months. OFAC sanctioned Grinex in August 2025.
The proposal also bans all transactions involving the digital ruble, Russia's central bank digital currency, and extends export restrictions on dual-use goods to Kyrgyzstan - a jurisdiction that has become a key node in Russia's crypto-based evasion infrastructure.
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Why it matters
Russia has increasingly turned to crypto and stablecoins to sustain cross-border trade as conventional banking channels narrow.
The ruble-pegged A7A5 stablecoin - issued by a Kyrgyz firm tied to Garantex - processed over $51 billion through mid-2025, according to Chainalysis.
The EU banned A7A5 transactions and sanctioned the payment platform Payeer in its 19th package last October.
What's next
The package requires unanimous approval from all 27 member states. At least three have expressed reservations, and exact details of the crypto restrictions remain unclear.
The Commission initially aimed for adoption before Feb. 24, the fourth anniversary of the full-scale invasion.
If approved, the measures would mark a fundamental shift from targeting individual bad actors to blocking an entire financial channel - raising questions about enforcement feasibility in a decentralized ecosystem.
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