EU sanctions Russian crypto exchange Garantex due to conflict with Ukraine

The European Union took action against Garantex – a crypto exchange with a Russian base – as part of the 16th sanctions package it has imposed on entities connected to Ukraine’s conflict.

In a release on the 24th of February, the EU identified Garantex a major player in Russia’s efforts at bypassing financial restrictions.

The council cited as the primary reason the close association of the exchange with Russian banks, which are already under EU sanction. The EU is sanctioning a Russian crypto-exchange for the first time.

The EU’s latest sanctions seek to limit Russia’s access to financial resources and disrupt its ability to fund military operations. The EU’s latest sanctions are aimed at closing financial loopholes which allow Russia to circumvent economic limitations through cryptography.

Notably, CryptoSlate previously reported that Russians had turned to digital assets like Bitcoin and Tether’s USDT to neutralize the impact of Western sanctions on its economy.

The package also includes sanctions on 48 individuals and 36 entities, bringing the total sanctioned persons or organizations to more than 2,400.

The EU said that these sanctioned organizations actively support Russia’s military efforts. In response, the assets of these entities have been frozen. EU citizens and companies are also prohibited from doing business with them. Travel bans are also imposed on those listed, limiting their movements within EU member countries.

The sanctions also apply to other Russian oil companies, Chinese satellite imaging firms, media propagandists and business people, as well as political entities. These measures are designed to put more economic and financial pressure on Russia’s war-linked networks.

The United States and United Kingdom have previously imposed restrictions on Garantex. In 2024, investigators from the United States and the United Kingdom were investigating the exchange’s role for processing about $20 billion USDT.

The US Treasury had accused Garantex before of not complying with anti-money-laundering (AML), counter-terrorism funding (CFT) and other regulations. This allowed for illicit transactions on its platform.

The result is that the wallets of the exchange are now listed on the Office of Foreign Assets Control’s (OFAC) Specially Designated Nationals (SDN) List. The wallets of the exchange are now on the Office of Foreign Assets Control (OFAC), Specially Designated Nationals List (SDN).