The European Union (EU) in support of Ukraine is moving to impose even greater sanctions on Russia. In a new tranche of sanctions, the body has stated that it is targeting deposits made to crypto wallets by sanctioned individuals.
The EU imposes more crypto sanctions on Russia
Reuters reports that the latest rule is intended to tie loose ends in all the other sanctions it has already imposed on Russia.
This will contribute to closing potential loopholes, the EU stated.
In the same regulation, the EU has banned the sale of banknotes and transferable securities to Russia and Belarus. The EU also issued a full transaction ban on four Russian banks, as well as import bans on coal, wood, chemicals, and other products from Russia.
These latest sanctions were adopted following the atrocities committed by Russian armed forces in Bucha and other places under Russian occupation, Josep Borrell, an EU diplomat said.
The EU’s crypto wallet ban on Russia is coming after the bloc effectively outlawed unhosted and self-hosted cryptocurrency wallets in its Transfer of Funds Regulation (TFR) voted on last month.
The EU stated that the law is part of new anti-money laundering steps it is taking to protect member states. The law brings rules that require crypto exchanges to collect and report information of both sender and recipient of any crypto transaction that exceeds 1000 EUR.
Asides from anti-money laundering concerns, the EU has also questioned the environmental impact and energy consumption of the crypto industry. It has been seeking to put laws in place to ban proof of work crypto mining within its jurisdiction.
The crypto industry is strongly opposed to the EU’s plans
The generally unfavorable stance the political and economic union with 27 member states has towards crypto has been the subject of a lot of activism. Crypto industry heavyweights including the CEO of Coinbase, Brian Armstrong, have spoken out against the EU’s proposed regulations.
Armstrong warned of the privacy evasion implications that the EU’s new crypto rule will have. He said: “The proposal is anti-innovation, anti-privacy, and anti-law enforcement.”
Similarly, Blockchain for Europe, an NGO that represents international crypto industry players at the EU level, opined that the requirements amounted to the EU failing to advance future proof regulations for the crypto space.
2/ The #EU failed to advance future-proof regulation for our nascent #blockchain industry which would have ensured consumer protection and positioned Europe as a global leader in the future Web3.0 economy.
— Blockchain for Europe (@BlockchainforEU) March 31, 2022
Meanwhile, the crypto industry has continued to give regulators assurance that cryptocurrencies are not a viable avenue for Russia and Belarus to use in evading sanctions.
Chainalysis, an industry-leading crypto data monitoring and analytics firm, went ahead to develop and launch a suite of free sanctions screening tools for the crypto industry. This is added to measures already being taken by crypto exchanges like Coinbase and Binance.
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