The EU Commission has proposed a comprehensive ban on all crypto transactions with Russian service providers. Its 20th sanctions package would broadly prohibit any contact with crypto providers based in Russia.
Until now, Brussels placed individual platforms on sanctions lists. Now a ban on the digital ruble is being added, Russia's planned central bank digital currency (CBDC). EU Commission President Ursula von der Leyen presented the package on February 6. Adoption requires the unanimous approval of all 27 member states. Three countries have already raised concerns. Yet the package extends far beyond crypto measures. It includes export bans worth over EUR 360 million. Import restrictions on steel, scrap, and chemicals amount to EUR 570 million. A complete services ban for tankers carrying Russian crude oil rounds out the measures.
Subscribe to our newsletter
The best articles of the week, directly delivered into your mailbox.
Why Brussels is changing course
This strategic shift has a concrete reason. According to an internal Commission document, the existing practice of sanctioning individual crypto exchanges merely leads to the creation of new platforms. Such patterns are well documented. After law enforcement seized USD 26 million from Garantex in March 2025, former employees immediately launched the successor platform Grinex. The payment platforms A7, A71, and A7 Agent also emerged.
"Each further listing of individual crypto-asset service providers would likely lead to the creation of new providers to circumvent these sanctions. To ensure that sanctions achieve their intended effect, the EU prohibits contact with any crypto-asset service provider established in Russia." - Internal EU Commission document
The ruble-backed stablecoin A7A5 is particularly relevant. Launched in January 2025, it reached a total transaction volume of USD 100 billion within one year. Around 41,300 accounts used the token for approximately 250,000 transactions. A7A5 is issued by Old Vector in Kyrgyzstan, backed by ruble deposits at the sanctioned Russian state bank Promsvyazbank. In practice, the stablecoin operates in a regulatory gray zone between Central Asia and Russia.
A7A5: sanctions slow but do not stop
The EU sanctioned A7A5 in October 2025 as part of the 19th sanctions package. Meanwhile, the US had already placed Grinex and the entire A7 network on the sanctions list in August 2025. Nine entities and three executives were targeted, including Garantex co-founder Sergey Mendeleev.
These measures had an effect, but a limited one. Daily transaction volume for A7A5 dropped from USD 1.5 billion in mid-2025 to around USD 500 million in January 2026. Yet the user base continued to grow. Currently, 35,500 accounts hold the token, up from 14,000 in July 2025. In total, 42.5 billion units remain in circulation, corresponding to a market value of USD 547 million.
Behind the network stands Ilan Shor, among others. The Moldovan businessman was convicted of fraud and sanctioned for election interference. Also involved is Promsvyazbank, sanctioned for supporting the Russian defense sector. As a result, the EU's total ban aims to systematically capture such structures rather than pursuing individual actors.
Kyrgyzstan as the first target of the anti-circumvention instrument
Beyond the crypto measures, the EU plans to deploy its anti-circumvention instrument, introduced in 2023, against a third country for the first time. Kyrgyzstan is the focus. The numbers speak for themselves. EU exports of dual-use goods to Kyrgyzstan have risen by 800 percent since the start of the war. Kyrgyz exports of the same goods to Russia increased by 1,200 percent.
Brussels therefore plans to ban exports of CNC machines and radio equipment to Kyrgyzstan. Additionally, the Kyrgyz company TengriCoin is set to be blacklisted for trading the A7A5 stablecoin. Despite repeated talks, Kyrgyzstan has failed to implement effective export controls, according to the EU Commission.
Kyrgyzstan's position is defensive. First Deputy Cabinet Chairman Daniyar Amangeldiev stated that Bishkek had received no official notification of sanctions. He argued the trade statistics were misleading because the original volumes were very low.
Regulatory framework tightens
The new EU crypto sanctions against Russia complement an increasingly tight regulatory framework. MiCA, the EU-wide crypto regulation, has been fully applicable since December 2024. Crypto service providers must screen transactions against sanctions lists and report suspicious activity. Violations carry penalties of up to EUR 5 million or 10 percent of annual revenue.
Since January 2026, DAC8 also imposes tax transparency requirements on crypto transactions. Meanwhile, the Digital Operational Resilience Act (DORA) has required all MiCA-regulated firms to meet heightened IT security standards since January 2025. For Russian actors, the legal room to maneuver within the EU is shrinking systematically.
At the same time, Russia is pushing ahead with the digital ruble. A mass rollout is planned from September 2026, initially for systemically important large banks. Russian federal agencies have been able to use the CBDC since January 2026. By preemptively banning the digital ruble, the EU aims to block future circumvention channels early. Adoption of the 20th sanctions package is scheduled for February 24, the fourth anniversary of the Russian invasion. Unanimity among all 27 EU member states is required. EU sanctions envoy David O'Sullivan travels to Bishkek on February 26 for talks with Kyrgyz authorities on the anti-circumvention measures.
