Ukraine shoots “special sanctions” at Russian crypto entities

In an attempt to curb financing of the multi-year war waged by Russia, Ukraine has imposed a new sanctions package targeting Russian entities, particularly crypto-related ones.

Ukrainian President Volodymyr Zelenskyy signed the package on Sunday, saying that the sanctions were the initiative of the National Bank of Ukraine.

"Just through one single company, now included in the sanctions list, and only since the beginning of this year, that is, prior to the sanctions being imposed, the Russians funneled several billion dollars, primarily for the needs of their military-industrial complex," Zelenskyy said, adding that "of course" they'll shut down all such schemes.

According to the president, the Russians are increasingly moving to cryptocurrency transactions as their traditional financial channels are blocked. For example, last year, Russia allowed its businesses to conduct international transactions in cryptocurrencies.

Now, 60 legal entities and 73 citizens of Russia have been sanctioned.

Vladyslav Vlasiuk, the Sanctions Commissioner for the Ukrainian President and Secretary of the International Working Group on Russian Sanctions, detailed in a Facebook post that the sanctions list includes 19 of the largest cryptocurrency miners in Russia that create schemes to circumvent sanctions, as well as 17 issuers of digital assets and five crypto exchanges, among others.

Some of the sanctioned companies have already been sanctioned by other countries, including A7, the issuer of the Russian ruble-pegged stablecoin A7A5.

And it’s not only Russian companies that made it onto the list. For example, there is Cyprus-registered Tokentrust Holdings Limited, which is part of the US-sanctioned Atomize. Meanwhile, Kazakhstan-based EXMO and UAE-based AWX Solutions FZ, operators of crypto exchanges, have also been sanctioned, among other crypto entities.

Zelenskyy noted that this move was synchronized with other countries, and this type of synchronization will continue.

"It’s a challenging task – sanctioning regulations vary around the world – but we all share a common goal: to compel Russia to stop the war and to severely restrict its capabilities," the president said.

In either case, Ukraine is considered to be a crypto-friendly country, with policies that support the use of this technology. Also, at the beginning of the Russian invasion in 2022, Ukraine received over $200 million worth of donations in crypto assets.