The EU on Thursday adopted its 21st package of restrictive measures against Russia to further weaken the Kremlin’s financial and industrial base, amid ongoing military attacks on Ukrainian civilians and critical infrastructure. The focus is on a first: for the first time, the EU is taking drastic measures in the crypto sector to consistently close loopholes in circumventing previous financial sanctions.
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So far, Russian actors have increasingly used digital assets and international crypto service providers to funnel capital past Western banking blocks. The EU is now countering this with a new set of instruments. Specifically, the EU Council has imposed transaction bans on 14 crypto platforms and related companies based in third countries such as Georgia, Panama, El Salvador, the United Arab Emirates, the Marshall Islands and Belarus.
The EU is also introducing the possibility of a complete ban on crypto services from third countries. This tool serves as a deterrent for countries whose jurisdictions are systematically used to evade sanctions. EU operators can therefore be prohibited from carrying out any transactions with crypto providers in relevant third countries.
In addition, EU governments have expanded the ban on Russian citizens from owning, controlling or serving on their governing bodies of crypto service providers. In order to avoid unintentional hardship for EU citizens, an exception provides that nationals of member states are allowed to withdraw their own funds from newly listed banks and crypto platforms.
Pressure on the financial system and third countries
In addition to the virtual financial space, the EU is increasing the pressure on the traditional banking system. New transaction bans affect 33 additional financial institutions – a total of over 100 Russian banks are now affected and excluded from the SWIFT system. Banks in third countries are also being targeted, including institutions in Mongolia, Kyrgyzstan and Indian branches of Russian banks that are undermining sanctions.
In addition to the financial sector, the resolutions cover other key sectors. In the energy sector, the automatic adjustment of the oil price cap will be suspended until July 2027. This is intended to prevent price increases due to the Iran war. At the same time, the EU wants to intensify the fight against the shadow fleet: The rules now also affect ships for refueling and auxiliary services, with 41 more tankers ending up on the sanctions list.
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Overall, the decision includes the largest wave of individual assessments in four years: 218 people and institutions are now newly listed. The measures are specifically aimed at the military-industrial complex, including manufacturers of kamikaze drones, logistics companies, arms managers and executives of state media companies. Overall, the EU wants to consolidate its course of effectively closing loopholes in the digital and analog financial space and restricting the Russian war economy’s ability to act.
(nen)
