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The EU hits the Kremlin hard with sweeping economic sanctions
11.54pm ▪ 5 minute read ▪ by Evans S.
The European Union is not known for doing things halfway, especially when it comes to economic sanctions. This time the goal is clear: to put pressure on the Kremlin by targeting its crypto infrastructure and alternative financial means. It is a real blow for Russia, the repercussions of which could be felt far beyond Europe’s borders.
EU Targets Cryptocurrency Providers
Latest European Union sanctions directly target Eurozone traders interacting with cryptocurrency providers who facilitate Russian defense transactions effort.
This is a total ban on these interactions, a drastic measure aimed at cutting off financial resources to support the Kremlin’s war machine.
This decision marks a new stage in the economic war that the EU is waging against Russia. By banning these transactions, the EU hopes to dry up the financial flows that fuel Russian military capabilities. Crypto asset providers therefore find themselves in the crosshairs, forced to comply or face serious consequences.
But that is not all. The new sanctions also include a ban on using SPFS, the financial message transfer system developed by Russia to circumvent the SWIFT exclusion.
This ban aims to further isolate Russia from international financial networks, further complicating its cross-border transactions.
Russian SPFS system ban
The SPFS, conceived as a Russian alternative to SWIFT, plays a crucial role in Russia’s attempts to mitigate the impact of Western economic sanctions.
By banning European entities from connecting to the SPFS, the EU tightens its grip on Russian financial transactions. This ban makes it more difficult for Moscow to use this system to support its military operations.
The EU Council has made it clear this ban applies to all European operators. This includes those based inside and outside Russia. Foreign subsidiaries of European companies must also comply with this new regulation or face sanctions.
Indeed, these restrictive measures add to a series of already severe sanctions imposed on Russia since the invasion of Ukraine.
The disconnection from SWIFT and the seizure of billions of dollars of Russian funds in the West are some examples of actions aimed at weakening the Russian economy.
Putin’s “dark fleet” in the spotlight
Russia has not given up its ambitions. Some tactics used to circumvent sanctions have proven particularly ingenious. Among these, the use of “Putin’s dark fleet”. This is a fleet of oil tankers that operates discreetly to continue exporting oil despite the restrictions.
This fleet, accused of helping Russia circumvent sanctions, is now in the crosshairs of the EU. By identifying and sanctioning these ships, the EU wants to make Russia’s operations more difficult. It also aims to reduce oil revenues, a key source of funding for its war efforts.
The EU Council announced the identification of 27 ships that are part of this fleet. These ships, in fact, will be subject to specific sanctions. Additionally, 61 new entities were added to the blacklist for their direct support of the Russian war effort. This illustrates an intensification of efforts to isolate Russia economically.
The European Union, through these radical economic sanctions, sends a clear message. He is determined to use all means at his disposal to put pressure on the Kremlin and reduce its ability to wage war in Ukraine. The target is multiple: from cryptocurrency providers to “dark fleet” tankers, including the SPFS system.
As Russia continues to look for ways to circumvent these sanctions, the effectiveness of these measures remains to be seen. What is certain is that the EU does not intend to ease the pressure any time soon. Each new initiative demonstrates the desire to strike hard and in a targeted way.
The coming months will tell whether these efforts will succeed in breaking the Kremlin or whether Russia will find new ways to resist. economic offensive.
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Evans S.
Fascinated by bitcoin since 2017, Evariste has not stopped documenting himself on the subject. If his main interest is on trading, the wise man is desperate to discover all the advanced centers on cryptocurrencies. As an editor, he aspires to permanently provide high-quality work that reflects the state of the sector as a whole.
DISCLAIMER
The views, thoughts and opinions expressed in this article are solely those of the author and should not be relied upon as investment advice. Do your research before making any investment decisions.