The European Commission is advancing a proposal to prohibit all cryptocurrency transactions between individuals or entities based in the European Union and their Russian counterparts. This measure is a direct response to concerns that digital assets are being used to circumvent international sanctions imposed on Russia.
The proposal specifically targets any crypto asset service provider or platform established in Russia that facilitates the transfer and exchange of cryptocurrencies. It follows documented cases where sanctioned entities, such as the Garantex exchange, attempted to continue operations by rebranding to Grinex. Furthermore, the proposal highlights the A7A5 stablecoin network, which is linked to the Russian ruble and reportedly moved approximately $70 billion in 2025. Experts note that such infrastructure enables funds to remain active even when traditional banking channels are blocked.
For the ban to be enacted, it requires unanimous support from all 27 EU member states. The process could face delays, as three countries have already expressed concerns regarding its implementation. Even if passed, analysts caution that the ban may increase friction but not completely stop the flow, as Russian actors could potentially use intermediaries, third-country brokers, and shell entities to evade the new restrictions.
This regulatory move coincides with heightened global scrutiny of cryptocurrency's role in illicit finance. In a related development, authorities in Russia's Republic of Dagestan have opened a criminal investigation against a local man suspected of financing terrorism, according to the state news agency TASS. While specific details of the case were not disclosed, it underscores ongoing law enforcement efforts to clamp down on financial networks linked to extremism, with a particular focus on the potential use of digital assets.
