UK authorities are ramping up their pressure on Russia with a fresh sanctions package targeting over a dozen individuals, crypto networks, and firms used to bypass the country’s sanctions.
Russia-Linked Crypto Firms Hit With New Sanctions
On Tuesday, the UK’s Foreign, Commonwealth & Development Office (FCDO) announced a new package of sanctions targeting crypto firms and illicit networks used by Russia to circumvent sanctions and channel funds.
The announcement disclosed that the Kremlin has “increasingly turned to dark networks and shadow financial systems to bypass legal restrictions.” Consequently, the UK government is taking measures to restrict these avenues and adapt its approach to counter Russian evasion strategies effectively and shut down the payment routes that fuel its “war machine” against Ukraine.
The package designated 18 entities linked to Russia’s illicit financial infrastructure used to move funds, procure goods, and sustain the war against Ukraine, such as the A7 network. Notably, the Kremlin-backed network reportedly exploits Kyrgyzstan’s financial systems to channel funds into Russia.
The measures target key A7-linked individuals, including a Kyrgyz bank suspected of facilitating payments for the network and a major global cryptocurrency exchange suspected of channeling over $1.5 billion back into the Kremlin’s hands.
Officials have sanctioned Huobi Global S.A., the Panamanian company that operates crypto exchange HTX, listing it as part of the “entities and individuals involved in making available funds, economic resources, goods or technology to individuals and entities in the Russian financial sector.”
A spokesperson for HTX told Bloomberg that “Regulatory compliance remains our absolute top priority at HTX,” adding that they “proactively monitor and strictly adhere to regulatory frameworks in all jurisdictions where we operate globally, including the UK.”
The FCDO also imposed sanctions on three Georgian companies operating Russia-focused exchanges seeking to evade sanctions. The list names crypto exchanges and financial services providers, EXMO Exchange Limited, ARVIX Limited Liability Company, RAPIRA GROUP LLC, AIFORY LLC, among others, as entities and individuals “involved in supporting the Russian financial sector.”
List of entities and individuals sanctioned in the UK’s latest package. Source: FCDO
International Crackdown Intensifies
Over the past four years, the UK has sanctioned over 3,300 individuals, businesses, and ships to sever the Kremlin’s access to vital cash flows, the announcement noted. This has significantly impacted Russia’s war economy, with officials estimating the loss of approximately $450 billion due to international sanctions, equivalent to four years of funding for its war against Ukraine.
Earlier this year, the European Commission (EC) began exploring measures to prohibit all crypto transactions linked to Russia to further crack down on the country’s use of digital assets to evade sanctions.
As reported by Bitcoinist, the EC’s proposal focused on preventing the growth of successors to the Russia-linked exchange Garantex, targeting payments platform A7 and connected ruble-pegged stablecoin A7A5.
The FCDO noted that “as long as the killing in Ukraine continues, the UK and its allies stand ready to ratchet up pressure on Russia and will continue to strengthen sanctions at every opportunity.”
Foreign Secretary Yvette Cooper stated that “If the Kremlin thinks it can evade our sanctions by hiding behind crypto networks and shadow financial systems, it is gravely mistaken.”
“We will continue to act fast and decisively, alongside our allies, to expose, disrupt and dismantle these networks, and ensure those enabling Russia’s aggression face consequences,” she concluded.
The total crypto market capitalization is at $2.51 trillion on the one-week chart. Source: TOTAL on TradingView
Featured Image from Unsplash.com, Chart from TradingView.com
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