YEREVAN (CoinChapter.com) — The European Union (EU) has imposed sanctions on Garantex, a Russian crypto exchange, for its role in assisting entities to bypass financial restrictions related to the Ukraine conflict. This action is part of the 16th EU sanctions package, which focuses on restricting Russia’s access to digital assets used to evade economic penalties.
On Feb. 24, the EU Council issued a statement identifying Garantex as a financial network with strong ties to sanctioned Russian banks. The council cited the exchange’s role in enabling transactions that support Russia’s military operations, marking the first time the EU has directly sanctioned a Russian crypto exchange.
Garantex’s Role in Circumventing Financial Restrictions
The EU Council stated that Garantex has facilitated financial transactions for Russian entities already under existing sanctions. Recent reports highlight that Russians have increasingly used cryptocurrencies like Bitcoin and USDT to minimize the impact of Western financial restrictions. The EU’s move aims to disrupt these activities by cutting off Garantex from the European financial system. Authorities noted that Garantex has connections to sanctioned Russian financial institutions, making it a significant target for economic penalties. As part of the sanctions, its assets within the EU are now frozen, and EU businesses and individuals are prohibited from engaging in transactions with the exchange.
Over 2,400 Individuals and Entities Now Under Sanctions
The 16th EU sanctions package extends restrictions to 48 individuals and 35 entities, bringing the total number of sanctioned persons and organizations to more than 2,400. The EU stated that the newly sanctioned entities actively support Russia’s military and economic efforts. As a result, their assets are frozen, and their ability to conduct financial transactions with European institutions has been blocked.
Garantex Previously Sanctioned by the US and UK
The EU’s decision follows similar actions by the United States and the United Kingdom. In 2024, US and UK authorities investigated Garantex’s role in processing approximately $20 billion in USDT transactions. Earlier, the US Treasury’s Office of Foreign Assets Control (OFAC) placed Garantex’s wallets on its Specially Designated Nationals (SDN) List. The US Treasury accused the exchange of failing to comply with anti-money laundering (AML) and counter-terrorism financing (CFT) regulations, leading to illicit transactions on its platform.
