The European Union has recently expanded its sanctions against Russian-related encryption activities by adding 14 overseas encryption service platforms to the restricted list, while providing the legal basis for limiting encrypted transactions at the national level. The new measures also extend Russian and Belarusian equity, control and management restrictions on European Union encryption enterprises to more types of services regulated by the MiCA.
14 additional platforms restricted
According to the Council of the European Union, the round of sanctions was adopted on 23 July and involved platforms in Georgia, Panama, the United Arab Emirates, the Marshall Islands, Kyrgyzstan and Belarus. EU operators will be prohibited from conducting related transactions with the listed encrypted asset service providers.
National ban included in toolbox
Of even greater concern is the fact that the European Union can now directly restrict transactions with an encryption service provider in a third country when it determines that it has been unable for a long time to prevent the relevant platform from helping Russia to evade sanctions. That is to say, sanctions are no longer limited to individual platforms, and the EU can in the future extend its pressure to the entire jurisdiction.
Synchronize restrictions on encryption enterprises in the EU
Since 25 August, the shareholding, control and management of positions of Russian and Belarusian nationals and residents in European Union encryption enterprises will be further expanded to cover additional services under the MiCA framework, including encryption consulting, portfolio management and client transfer. It also noted that the MiCA transition period had ended and that it would be difficult for unauthorized service providers to continue to provide related services.