European Council targets crypto in new wave of Russia sanctions 

EU flag.
Editorial credit:

The European Council has announced more financial restrictions on Russia as part of the 14th package of restrictive measures due to the war with Ukraine.

In a bid to deal a further blow to Putin’s regime, the Council has decided to outlaw the use of the ‘System for Transfer of Financial Messages’ (SPFS), a specialised financial messaging service deployed by the Central Bank of Russia to neutralise the effect of restrictive measures.

As part of this restriction, EU entities operating outside of Russia will not be allowed to connect to the SPFS or any other equivalent specialised financial messaging services. 

Furthermore, EU operators will be barred from making transactions with specifically listed entities using SPFS outside of Russia.

Additionally, the Council has introduced sanctions surrounding crypto asset providers. The ruling places a ban on targeted credit and financial institutions and crypto asset providers established outside the EU facilitating transactions that support Russia’s defence-industrial base.

These transactions can be through the export, supply, sale, transfer or transport towards Russia of dual-use goods and technology, sensitive items, battlefield goods, firearms and ammunition.

Since the start of the war, the Council has placed hundreds of restrictions on Russia. In 2022, the country faced sanctions regarding maritime navigation together with radio communication technology. 

Josep Borrell, High Representative for Foreign Affairs and Security Policy, said: “Our sanctions have already significantly weakened the Russian economy and prevented Putin from accomplishing his plans to destroy Ukraine, although he still continues the illegal aggression targeting civilians and civilian infrastructure. 

“The 14th package of sanctions demonstrates our unity in supporting Ukraine and seeking to limit Russia’s criminal activities against Ukrainians, including efforts to circumvent EU measures.”