The European Union announced its 21st round of sanctions against Russia, extending its reach for the first time to include overseas crypto service platforms. According to measures adopted by the European Council on July 23, 14 crypto service platforms and 94 banks and financial institutions were added to the restricted list, citing their alleged ties to Russia's efforts to circumvent existing financial restrictions.
Sanctions expanded to include overseas encryption platforms
Not all of the named encryption service providers are based in Russia. The EU stated that the platforms are located in Georgia, Panama, the UAE, the Marshall Islands, Kyrgyzstan, and Belarus, and are used to facilitate the transfer of funds linked to Russia.
The European Council stated that this round of sanctions adds 218 new entities to the list, including 48 individuals and 170 entities. This is the largest batch of new sanctions imposed by the EU in nearly four years, covering financial services, energy, the defense supply chain, and organizations accused of circumventing sanctions.
EU adds whole-territory restriction tools
In addition to imposing transaction restrictions on 14 platforms, the EU has added a broader tool. If a third country is found to be allowing local crypto service providers to help Russia circumvent EU restrictions, the EU can directly prohibit operators in that region from transacting with the relevant crypto service providers in that jurisdiction.
This means that the EU's restrictions are no longer limited to individual platforms but can be extended to entire categories of cross-border encrypted service channels. The EU describes this arrangement as a deterrent measure, intended to reduce payment routes that continue to operate through third-country platforms.
The EU also added four entities linked to the A7 cross-border payment network to its list, including entities related to its African operations. The EU has previously cited third-country payment channels as a key means for Russia to maintain access to international financial services.
Banks and payment networks tighten restrictions simultaneously.
Regarding financial restrictions, the 94 listed banks and large financial institutions will face asset freezes, and EU entities are prohibited from providing them with funds. At the same time, the EU has extended the transaction ban to another 33 Russian credit and financial institutions, prohibiting EU companies and individuals from doing business with them.
Four other non-Russian banks were also included in the trading ban. The EU stated that one of them, from Kyrgyzstan, is linked to the Russian financial information transmission system SPFS; the other three are accused of assisting related entities in circumventing EU sanctions.
Existing EU rules already covered the Central Bank of Russia, over 100 Russian banks, and certain crypto trading, crypto wallets, accounts, and custody services. This round of measures further tightens this existing framework, focusing on restricting Russia's ability to conduct cross-border settlements through overseas platforms and alternative payment networks.
Increase investment in both energy and defense sectors
In addition to the financial and crypto sectors, this round of measures also includes 41 vessels associated with a "shadow fleet" and restricts several oil refineries, oil traders, and entities in the military supply chain. The EU stated that more than 50 entities on the new list are linked to the Russian military-industrial complex and the production of long-range drones.
Regarding export controls, stricter restrictions were imposed on 51 entities involving dual-use items and technologies, located in China, India, Turkey, Kazakhstan, Kyrgyzstan, and the United Arab Emirates. The trade restrictions also cover materials and equipment needed for coatings on aircraft, drones, missiles, and engines.
Overall, the EU's latest round of sanctions is not only targeting Russian domestic institutions, but also further shifting towards overseas financial and crypto intermediary networks, attempting to block alternative settlement channels beyond the restrictions of traditional banks.
