EU Empowers Regulators to Block Third-Country Crypto Platforms

21st EU Sanctions Package Against Russia Expands Scope Of Crypto Restrictions

The EU has moved to expand the scope of its crypto sanctions against Russia, enabling nationwide blocks that would simplify targeting exchanges in nations that systematically enable Russian nationals to evade the sanctions imposed using cryptocurrency assets.

In the new 21st package of sanctions against Russia, approved on July 23, the EU added 4 designations related to the A7 Russian ruble network, also targeted by the U.K. government in May. The new EU provisions sever its links with Africa-based institutions, adding transaction bans to 14 crypto service platforms in Georgia, Panama, the UAE, the Marshall Islands, Kyrgyzstan, and Belarus.

These additions follow sweeping measures implemented in the previous sanctions package, which targeted the whole Russian crypto industry.

But apart from these, two new provisions seek to thwart Russians’ ability to leverage crypto to aid the war effort. The first one, which becomes effective on August 25, extends a prohibition on Russians and Belarusians from owning or controlling, or holding positions in EU-based cryptocurrency service providers.

These restrictions, which were first included on 18 January 2024, now apply to any other crypto-asset services described in the Markets in Crypto Assets (MiCA) regulations, including advisory, portfolio management and transfer services on behalf of customers, as described in Article 5b of Council Regulation (EU) 2026/1848 of 23 July 2026, which amends Regulation (EU) No 833/2014.

The second provision establishes a crypto transaction ban on entire countries where service providers fail to comply with these sanctions, giving these extraterritorial status.

Article 5bc of amended Regulation 833/2014 states that “it shall be prohibited to engage, directly or indirectly, in any transaction with a legal person, entity or body that is an entity providing crypto-asset services or is a platform enabling the exchange or transfer of crypto-assets and is established in a third country.”

Furthermore, regulations specify that this nation list, currently empty, “shall include only third countries that have been identified by the Council as having systematically and persistently failed to prevent the provision of crypto-asset services, or to prevent platforms exchanging or transferring crypto-assets.”

For Nick Turner, an economic sanctions expert, this shift means the EU is leaning into secondary sanctions after having a long history of opposing them. He also stressed that this might cause legal conflicts in jurisdictions where regulation conflicts with EU sanctions.

“Under the new Article 5bc, a country’s regulators are on the hook for failing to stop EU-sanctioned activity, regardless of the country’s own laws,” he stressed. Turner believes this measure will be used for diplomatic leverage at first, explaining it was “hard to say” if any country would be hit directly by these measures.