Crypto firms cut off services in Russia as EU tightens crypto ban

The European Union has confirmed a sweeping ban on providing crypto services to Russians as it tightens sanctions in the wake of what it calls “sham” secession votes in four Ukrainian regions. All transfers from Russians to European crypto wallet providers will be forbidden. Meanwhile, NFT creator Dapper Labs and crypto exchange OKX has also cut off payment services for NFT owners with links to Russia as restrictions tighten.

As CoinDesk reported, the bloc introduced the eighth set of economic and political measures against Russia after the invasion of Ukraine in February, tightening a previous rule that limited crypto payments to European wallets to 10,000 euros.

“The existing prohibitions on crypto assets have been tightened by banning all crypto-asset wallets, accounts, or custody services, irrespective of the amount of the wallet,” the European Commission said in a statement on Oct. 6, after proposals it made last week were signed off by EU governments.

The measures, which notably seek to cap the price of oil that Russia can sell, follow the country’s attempt to annex the regions of Donetsk, Luhansk, Kherson, and Zaporizhzhia.

The crypto clampdown, which took effect later this day after appearing in the EU’s official journal, forbids services being offered by European crypto providers to Russian residents and entities unless they live in the bloc.

CoinDesk suggests this move was motivated by fears that the existing 10,000 euro cap was not doing enough to curb payments from Russia.

“We realized that transactions were still going on on some scale” even after measures were imposed in April, an EU official said. “We wanted to make sure that these services are not rendered anymore” by EU operators.

As a result, Dapper Labs, the company behind popular NFT collections, such as NBA Top Shot, has cut off payment services for NFT owners with links to Russia, citing EU sanctions in a blog post on Oct. 6.

Dapper Labs said, “It is now prohibited to provide crypto-asset wallet, account, or custody services of any value to accounts with connections to Russia.”

Impacted users can still look at their NFTs, but they cannot move funds, gift tokens, sell NFTs or buy new ones, Dapper said in the post, citing its payment processor.

Meanwhile, crypto exchange OKX also cut off its services in Russia earlier this week, and more crypto projects will likely follow as restrictions tighten.