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The European Union is set to crack down on Russia’s ability to evade economic sanctions using cryptocurrencies, according to France’s Finance Minister Bruno Le Maire.
“We are taking measures, in particular on cryptocurrencies or crypto assets which should not be used to circumvent the financial sanctions decided upon by the 27 EU countries,” Le Maire reportedly said yesterday.
This is not the first time public officials have raised concerns about Russia using cryptocurrencies to evade sanctions.
Amid the wake of Russia’s invasion of Ukraine, Ukrainian Vice Prime Minister Mykhailo Fedorov called on cryptocurrency exchanges to ban Russian users.
Earlier this week, several Senate Democrats also asked Treasury Secretary Janet Yellen how the U.S. could ensure crypto would not be used by Russia to evade sanctions.
As early as last October, the Treasury Department released a report that said digital assets risk undermining the U.S. sanctions regime—a long-established cornerstone of American foreign policy.
“These technologies offer malign actors opportunities to hold and transfer funds outside the financial system. They also empower our adversaries seeking to build new financial and payment systems intended to diminish the dollar’s global role,” the report said.
Russia, crypto, and sanctions
A prevailing fear is that Russia could pivot to types of ransomware as a means of using cryptocurrencies to evade sanctions. According to blockchain analytics firm Chainalysis, about three-quarters (74%) of the world’s global ransomware revenue in 2021 came from sources “highly likely” to be affiliated with Russia.
In Russia’s famous Moscow skyscraper, Vostok, the country also houses several crypto-related businesses that process “substantial transaction volume” from illicit sources, per Chainalysis.
Former FBI agent and current Director of Threat Intelligence at Abnormal Security Crane Hassold also recently told Decrypt that cryptocurrencies are the “primary factor” driving today’s ransomware landscape.
“It essentially allows the overall ransomware payments that we’ve seen previously to scale to numbers that are pretty crazy,” said Hassold.