The latest reports indicate that the EU has banned the provision of any high-value crypto-asset services to Russia in an attempt to impose more sanctions after the nation invaded Ukraine.
In an official press statement, the European Union, under the fifth package of limitations and sanctions on Russia, said that targeting cryptocurrency assets is meant to close as many loopholes as possible. The move was made after reports emerged that Russia may be turning to crypto assets as a dependable alternative to beat the extensive financial sanctions imposed by Western nations.
The statement read:
“A prohibition on providing high-value crypto-asset services to Russia. This will contribute to closing potential loopholes<…>A prohibition on providing advice on trusts to wealthy Russians, making it more difficult for them to store their wealth in the EU.”
In that context, the EU also noted that the sanctions also covered prohibiting deposits to all crypto wallets. Based on the council of the EU, more sanctions were implemented after Russia’s atrocities in Bucha.
After the invasion, EU-based cryptocurrency exchanges were at first compelled to apply sanctions preventing transactions from only the targeted individuals in Russia. Despite these clear directives, there were fears that some loopholes exist after acknowledgment by European Central Bank President Christine Lagarde.Buy Crypto Now
EU Increases Financial Sanctions
Apart from crypto, the European Union has already banned the sale of banknotes together with transferable securities like shares that are denominated in any official currencies of the EU member nations to Belarus and Russia.
The new sanctions also confirmed the whole transaction ban on four Russian banks, including VTB, which represents around 23% of the market share in the nation’s banking industry as highlighted by Finbold and other market analysts.
Notably, despite the European Union’s fears, Russia’s Prime Minister Mikhail Mishustin has continued to insist that the use of cryptos as a means of settlement is prohibited.
Mishustin also insisted that the government entirely supports the Central Bank’s view that cryptos cannot be used as a means of legal payment in the nation. Notably, the central bank had pushed for a blanket ban on cryptos.
With the extensive sanctions on Russia, the IMF has issued a stern warning about the consequences on the general financial system. Based on previous reports, the International Monetary Fund said that the sanctions could enhance the use of digital assets while undermining dollar supremacy.