The European Union is finalizing a broad new sanctions package aimed at preventing Russia from using cryptocurrency to circumvent existing restrictions. The proposal seeks to ban all crypto transactions with Russia and targets banks in third countries, as well as a specific ruble-pegged stablecoin, A7A5. Analysts question the enforceability of such a ban, citing decentralized liquidity pools that allow asset swapping without regulated intermediaries.
The European Union is finalizing a new sanctions package to close loopholes that officials say have allowed Russia to use cryptocurrency to circumvent existing restrictions. According to a report, the EU is seeking to “ban all cryptocurrency transactions with Russia” as part of its upcoming 20th sanctions package.
The proposed measures are broader than previous efforts targeting specific entities. An internal European Commission document stated that further listings of individual crypto providers would likely result in new ones being set up to circumvent them.
The package will target 20 additional Russian regional banks and several banks in third countries, according to European Commission President Ursula von der Leyen. Reuters reported the EU has proposed sanctioning two Kyrgyz banks, Keremet and OJSC Capital Bank of Central Asia, along with banks in Laos and Tajikistan.
The measures may specifically target the Russia-linked payments platform A7 and its ruble-pegged stablecoin, A7A5. Despite multiple sanction rounds, A7A5 emerged as one of the fastest-growing non-dollar stablecoins by market value in 2025, according to data from CoinMarketCap and DefiLlama.
Blockchain analytics firm Global Ledger identified patterns consistent with wash trading that may have inflated its volumes. Global Ledger co-founder Lex Fisun questioned the EU’s ability to fully enforce the proposed crypto sanctions.
“The EU’s recent move to impose a blanket ban on Russian crypto activity — specifically targeting the A7A5 stablecoin — highlights a fundamental misunderstanding of decentralized liquidity,” Fisun said. He noted holders can swap such tokens into globally traded stablecoins through autonomous onchain liquidity pools without compliant intermediaries.
“At this stage, distinguishing these funds from legitimate market activity becomes a technical impossibility […]. For European exchanges to enforce such a ban, they would essentially have to block all flows from major global trading hubs, a move that would paralyze the legitimate crypto market.” Fisun argued decentralized infrastructure remains resistant to direct censorship, making a complete technical blockade unlikely.
The developments coincide with Russia advancing domestic digital asset legislation. On Tuesday, Russian lawmakers passed a law on its third reading establishing the procedure for freezing and confiscating digital currency.
