USA Announces New Wave of Sanctions Also Concerning Cryptocurrencies

The US Treasury Department has imposed sanctions on several Russian financial services and technology players, including blockchain firm Atomyze, for their role in developing or providing services in cryptocurrencies aimed at evading sanctions against Russia related to the Ukraine war.

The US Treasury Department’s Office of Foreign Assets Control (OFAC) identified 13 entities and two individuals in the latest round of sanctions. These sanctions target Russia’s core financial infrastructure to prevent Russia from using the international financial system to further its Ukrainian war goals.

Five of these entities were identified by OFAC because they are owned or controlled by individuals currently sanctioned. Among the firms targeted was Atomyze, a fintech firm controlled by sanctioned Russian billionaire Vladimir Potanin’s Interros Holding investment group.

Atomyze was targeted for its work to tokenize precious metals and diamonds for Russian companies and its partnership with sanctioned Russian banks Rosbank and Sovcombank. Atomyze won Russia’s first government license to issue and exchange digital financial assets in February 2022, just three weeks before Russian forces invaded Ukraine. In July 2022, Atomyze launched the first digital token backed by palladium produced by Nornickel, a sanctioned metal producer also controlled by Potanin.

Other companies placed on OFAC’s list of specially designated nationals include fintech firm Lighthouse, which closed the first cash-backed Russian digital asset deal in June 2022. The Treasury said Lighthouse was working with Russia’s sanctioned central bank and major sanctioned lenders VTB and Sberbank.

Other financial technology firms subject to OFAC sanctions include B-Crypto, Masterchain and Veb3 Technology. The sanctions generally prohibit US dollar transactions by the companies in question and the US financial system.

*This is not investment advice.