EU explores ban on all Russian digital asset transactions

The European Union (EU) may be about to ban all digital currency transactions with Russia, in an attempt to block the pariah state’s sanctions evasion efforts, according to a recent European Commission (EC) document seen by the Financial Times.

On February 10, the FT reported that it had seen an internal EC document proposing the broad new measures as a more effective, if perhaps drastic, alternative to continuously banning copycat Russian digital asset entities from spawning, hydra-like, out of already sanctioned platforms.

“Any further listing of individual cryptoasset service providers… is therefore likely to result in the set-up of new ones to circumvent those listings,” read the EC note. “In order to ensure that sanctions achieve their intended effect [the EU] prohibits to engage with any crypto asset service provider, or to make use of any platform allowing the transfer and exchange of crypto assets that is established in Russia.”

Kyrgyzstan could also be affected by the proposed measures, with the EU reportedly considering a ban on the export of certain dual-use goods, alleging that companies in the country sold goods to Russia, such as electronics, used in drones and weapons deployed against Ukraine.

These allegations stem from reports that emerged last July, stating that Russian actors were using Kyrgyzstan’s digital asset ecosystem to evade international sanctions and purchase dual-use goods for its ongoing war in Ukraine. Research from U.K.-based blockchain intelligence firm TRM Labs, published in a July 21 blog post, found that Kyrgyzstan-registered exchanges “repeatedly facilitated transactions linked to sanctioned Russian entities.”

The same report also found that several of these exchanges exhibited on-chain heuristics similar to those of Garantex, the Russian digital asset exchange that was the subject of an international operation to disrupt its operations for facilitating terrorist financing and sanctions violations.

Last February, another TRM Labs report attributed more than 85% of inflows to sanctioned entities and jurisdictions in 2024 to Garantex and the Iranian exchange Nobitex.

The United States Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned Garantex in August 2025, accusing it of facilitating “notorious ransomware actors and other cybercriminals by processing over $100 million in transactions linked to illicit activities since 2019.”

The sweeping measures outlined in the EC document, revealed by the FT on February 10, are reportedly aimed at preventing the development of the “heirs” to the now-tainted Garantex.

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