UK crypto sanctions could wipe out half of Russia's war budget
Photo: $90 billion a year: Britain reveals details of sanctions against Russian cryptocurrency (Getty Images)
The network through which Russia funneled $90 billion a year, half of its military budget, has been blocked. The UK has identified specific platforms, names, and schemes used by these entities, they have been included in the new sanctions package, according to Vladyslav Vlasiuk, Ukraine's presidential envoy for sanctions policy.
The package targets two key tools Russia used to circumvent sanctions:
- Crypto exchanges, platforms through which rubles were converted into crypto assets without bank oversight.
- A7 network, a financial platform under the Kremlin’s umbrella for purchasing weapons, laundering oil money, and conducting transactions to bypass the West.
Last year alone, over $90 billion passed through A7, which is half of Russia’s annual war spending.
Platforms blocked
Rapira Group LLC (Georgia) — a crypto exchange focused on Russia. It conducted transactions worth tens of millions of dollars with the sanctioned entities Garantex and Bitpapa. It allowed crypto exchanges without identity verification and operated through Sberbank, VTB, Gazprombank, and Promsvyazbank. After Garantex was blocked, it took over a significant portion of its clients.
ABCeX (El Salvador, turnover - $11 billion) - allowed the exchange of rubles for crypto assets without standard banking restrictions, via cash and P2P schemes. Linked to Garantex’s cash flows, it has offices in Russia and operates through Russian banks.
Aifory LLC (Georgia) specializes in the ruble-cryptocurrency scheme. After Garantex was blocked, it lost a significant portion of its clients. It is also linked to the Iranian platform Abantether – the turnover between them amounts to approximately $2 million in cryptocurrency.
Additionally, EXMO Exchange Limited, ARVIX Limited Liability Company, and Bitpapa IC FZC LLC were added to the sanctions list.
The UK added four individuals to the sanctions list:
- Sergey Mendeleev, co-founder of the sanctioned exchange Garantex and the Exved platform, has spent years devising schemes to circumvent sanctions.
- Igor Gorin and Irina Akopian are deputy general directors of the A7 group of companies.
- Liran Cohen is an Israeli citizen linked to the A7 network.
Sanctions were also imposed against two Kyrgyz state entities—Eurasian Savings Bank and Virtual Asset Issuer.
Ukraine's role
"We are grateful to the United Kingdom for the sanctions targeting the financial sector and its infrastructure used by the Kremlin. Some of the decisions in this package are based on materials and proposals that the Ukrainian side, in particular the National Bank of Ukraine, provided to British partners as part of sanctions coordination. We will continue to target every transaction and individual that finances aggression against Ukraine or facilitates prohibited transactions," Vlasiuk states.
The day before, the United Kingdom announced the imposition of cryptocurrency sanctions against Russia. The restrictions apply to 18 financial institutions, banks, and crypto platforms. London also estimated that, thanks to the A7 network, Russia has recovered over $1.5 billion.
At the same time, the EU Council extended sanctions against Russia for human rights violations for another year, 72 individuals and one legal entity remain subject to the restrictions.
