EU Bans Provision of High-Value Crypto Services to Russia in Latest Set of Sanctions

The fresh sanctions extend to prohibiting Russians from deposits in crypto wallets

By Shomik Sen Bhattacharjee | Updated: 11 April 2022 14:42 IST

EU Bans Provision of High-Value Crypto Services to Russia in Latest Set of Sanctions

Photo Credit: Unsplash/ Mohd Azrin

The European Union has set a limit on cryptocurrency deposits originating from Russia

Highlights

The new sanctions aim to cover loopholes in earlier sanctions
The move extends the prohibition to deposits in crypto wallets
The sanctions also impose a full transaction ban on four Russian banks

The European Union has banned the provision of high-value crypto-asset services to Russia in the latest round of sanctions following the country's invasion of Ukraine. In a press statement, the EU, under the fifth package of sanctions on Russia, stated that EU-based crypto exchanges were already required to apply sanctions that bar transactions from targeted individuals, but there were concerns that loopholes remained. This refers to fears that wealthy Russians could use cryptocurrencies to evade financial sanctions imposed on Russia.

“A prohibition on providing high-value crypto-asset services to Russia. This will contribute to closing potential loopholes. A prohibition on providing advice on trusts to wealthy Russians, making it more difficult for them to store their wealth in the EU,” the statement read.

The EU further noted that the sanctions extended to prohibiting deposits to crypto wallets.

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This package's other financial restrictions include a "full transaction ban and asset freeze on four Russian banks, which are now totally cut off from the markets."

A prohibition has also been placed on providing financial advice to wealthy Russians to make it more difficult to store their wealth in the EU. According to the council of the EU, additional sanctions were adopted after Russia's atrocities in Bucha.

The crypto prohibition is one of three financial measures listed in the six-part sanctions package. Other items listed include a full asset freeze on four Russian banks that account for over a fifth of the country's banking sector and an embargo on advisory services for wealthy Russians.

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Other prohibitions covered in the sanctions package include import bans on all Russian coal, but not oil and gas. The sanctions also target goods like cement, rubber, and vodka, among others. The fifth round of sanctions also bars Russian nationals from procurement contracts in the EU.

According to Mikhail Mishustin, the country's prime minister, Russians reportedly own over $130 billion (roughly Rs. 9,86,600 crore) worth of crypto. Mishustin made the claim on Thursday while presenting a yearly report by the government.

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