Crypto News: UK Expands Russia Sanctions to Include Crypto Platforms

Key Insights:

• The UK sanctions crypto exchanges for the first time in crypto news updates.
• British regulators linked several crypto firms to the Kremlin-backed A7 payment network.
• Elliptic said crypto firms may trace blockchain transfers across multiple transaction hops.

Crypto news updates escalated after the United Kingdom expanded its Russia sanctions policy to include several digital asset firms and crypto exchange operators.

The measures marked the first time British authorities used the specific sanctions framework against cryptocurrency exchanges. Officials said the targeted firms allegedly supported financial networks linked to Russian sanctions-evasion activity.

The sanctions package, announced on May 26, named Bitpapa IC FZC LLC, Exmo Exchange Limited, Aifory LLC, and Rapira Group LLC. The U.K. Foreign, Commonwealth, and Development Office accused the companies of providing financial services, funds, or economic resources to A7 Limited Liability Company.

Crypto news on the move in the UK as it sanctions crypto exchange | Source: X

British authorities included the measures under the Russia (Sanctions) (EU Exit) Regulations 2019. The move formed part of a broad crackdown targeting financial entities and payment channels connected to Russian operations. The sanctions also covered banks, technology firms, and additional companies linked to the Russian financial sector.

Blockchain analytics firm Elliptic said the action marked the first use of Regulation 17A against crypto exchange businesses. The regulation was previously applied against sanctioned banking institutions.

Crypto News: UK Expands Sanctions List and Tightens Crypto Exchange Restrictions

The crypto news around the sanctions package also focused on the wider list of approved firms and individuals. Authorities named Arvix LLC, Alistera Limited, Sooty Ltd, Trace Road LLC, and Open Joint Stock Company Eurasian Savings Bank among entities accused of supporting the Russian financial sector.

Officials also sanctioned the Limited Liability Company Diamond Estate. Following the sanction, three individuals were named under the restrictions, including Igor Olegovich Gorin, Irina Rafaelyevna Akopyan, and Sergey Mendeleev.

Another section of the sanctions package targeted firms accused of making financial resources available to individuals tied to the Russian financial system. Those entities included Nueva Cryptologia and Huobi Global S.A. British authorities also listed Liran Cohen under that category.

The government additionally designated Open Joint Stock Company State Brokerage Company and Open Joint Stock Company Virtual Asset Issuer. Officials accused both companies of carrying on business considered economically beneficial to the Russian government.

Under Regulation 17A, U.K. financial institutions and crypto exchange service providers cannot maintain correspondent relationships with designated entities. In addition to the crypto news, the restrictions also prohibit processing payments connected to sanctioned companies.

Crypto Exchange Compliance Rules Expand

The sanctions package introduced additional compliance expectations for financial firms operating in digital asset markets. Authorities indicated that firms may need to freeze funds linked to sanctioned entities and trace related blockchain transactions.

According to Elliptic, the compliance process may require firms to track transactions across multiple blockchain “hops.” That process could extend monitoring beyond direct counterparties to wallets and exchanges appearing throughout a transaction chain.

British officials identified the Kremlin-backed A7 payments network as a major target of the sanctions package. In addition, authorities said the network processed proceeds from Russian oil sales and supported military procurement activity.

The U.K. government stated that the A7 network moved more than $90 billion during the past year. Officials linked several sanctioned entities to activities involving the payment network.

The crypto news also drew attention to how regulators may apply traditional sanctions rules within digital asset markets. Elliptic said other regulators could monitor Britain’s approach as authorities test the system against crypto exchange platforms and blockchain-related financial activity.

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