60 Russian Digital currency Companies Penalized by Ukraine for Circumventing Limitations

Ukraine has enacted sanctions against 60 crypto asset companies in Russia, which includes officials from the Central Bank of Russia. Are these sanctions likely to achieve their intended outcomes?

Since February 20, 2014, Russia and Ukraine have been embroiled in conflict, following Russia’s annexation of Crimea. The 2022 invasion of Ukraine represented a significant escalation. As of July 7, 2025, this conflict has persisted for more than three years, resulting in daily assaults that have led to casualties and damage to property on both sides.

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Ukraine Imposes Sanctions on Russian Crypto Companies

On July 6, 2025, Ukrainian President Volodymyr Zelenskyy endorsed a broad sanctions package involving 60 Russian crypto companies alongside 73 individuals, inclusive of officials from the Central Bank of Russia.

The goal of these sanctions is to hinder Russia’s capability to circumvent Western restrictions via digital currency assets. If they succeed, they may bolster Ukraine’s aim to sever Moscow’s financial framework during the ongoing conflict.

In particular, Ukraine focused on crypto mining companies and digital asset issuance processors located in Russia.

Already, Russia has been cut off from the SWIFT global payment platform, and limitations have been placed on its $640 billion foreign currency reserves.

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Russia’s Shift Towards Cryptocurrency

Nonetheless, Russia has increasingly depended on Bitcoin ▲0.84% and other preferred cryptocurrencies to navigate these sanctions, aiming to conduct trade and sustain economic stability. Reportedly, Russian oil enterprises have utilized Bitcoin and other leading cryptocurrencies to finalize transactions with nations not under sanctions, such as China and India.

In July 2024, the Duma approved legislation that legalized crypto asset payments for international commerce. The Central Bank of Russia, now subjected to Ukrainian sanctions, was authorized to manage a trial framework permitting approved enterprises to utilize crypto asset assets for cross-border transactions.

In August 2024, President Vladimir Putin endorsed crypto asset block rewards, which enables companies to mine Bitcoin as long as they register with tax authorities and adhere to energy consumption guidelines.

By December 2024, Finance Minister Anton Siluanov verified that Bitcoin mined domestically was being utilized in international trade under a trial arrangement with the Central Bank.

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Are These Sanctions Likely to Work?

It is still unclear whether Ukraine’s sanctions on Russian digital currency companies will prove effective.

Crypto asset transactions, including those involving the leading Solana meme coins, occur without borders and can be challenging to obstruct unless intermediaries are specifically targeted. 

For these efforts to be fruitful, Ukraine will need to work collaboratively on a global scale to pressure countries that are not implementing sanctions to limit their interactions with Russian digital currency firms. However, Russia’s allies, including China and the UAE, may persist in their engagements with these firms.

Moreover, Russia has developed an alternative payment framework, the Financial Messaging System (SPFS), and has proposed cryptocurrency exchanges in significant urban centers such as St. Petersburg and Moscow, which demonstrates an increasing ability to withstand Western sanctions.

In conjunction with BRICS initiatives to create an alternative payment currency and system, Russia is progressively moving away from the U.S.-centric financial system, providing it with a strategic leverage.

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