The EU has taken steps to expand the scope of its cryptocurrency sanctions against Russia, introducing the possibility of nationwide blocks, which will facilitate the targeting of exchanges in countries that systematically allow Russian citizens to evade sanctions using crypto assets.
In the new 21st package of sanctions against Russia, approved on July 23, the EU added 4 entities related to the A7 "Ruble" network, which also became the target of sanctions by the UK government in May. The new EU provisions sever ties with African organizations, imposing a ban on transactions for 14 crypto services in Georgia, Panama, the UAE, the Marshall Islands, Kyrgyzstan, and Belarus.
These additions follow the radical measures introduced in the previous sanctions package, which targeted the entire Russian cryptocurrency industry.
However, beyond that, two new provisions aim to deprive Russians of the ability to use cryptocurrency to support military operations. The first, effective August 25, expands the ban on ownership, control, or holding positions by Russians and Belarusians in crypto services based in the EU.
These restrictions, first introduced on January 18, 2024, now extend to any other crypto-asset services described in the Markets in Crypto-Assets (MiCA) regulation, including advisory services, portfolio management, and services for transferring funds on behalf of clients, as stated in Article 5b of Council Regulation (EU) 2026/1848 of July 23, 2026, amending Regulation (EU) No 833/2014.
The second provision establishes a ban on cryptocurrency transactions with entire countries if service providers do not comply with these sanctions, giving them an extraterritorial status.
Article 5bc of the amendment to Regulation 833/2014 states that "it shall be prohibited to directly or indirectly carry out any transactions with a legal person, organization, or body that is a crypto-asset service provider or a platform facilitating the exchange or transfer of crypto-assets and is registered in a third country."
Furthermore, the regulation clarifies that this list of countries, currently empty, "shall include only those third countries that have been identified by the Council as systematically and persistently failing to prevent the provision of crypto-asset services or to stop the activities of platforms facilitating the exchange or transfer of crypto-assets."
According to Nick Turner, an economic sanctions expert, this shift means the EU is leaning towards imposing secondary sanctions after a long history of opposing them. He also emphasized that this could lead to legal conflicts in jurisdictions where national regulation contradicts EU sanctions.
"Under the new Article 5bc, regulatory authorities of a country are responsible for failing to stop activities subject to EU sanctions, regardless of the country's own legislation," he stressed. Turner believes this measure will initially be used as a diplomatic lever, explaining that "it's hard to say" whether these measures will directly affect any country.
