UK Targets Russian Crypto Networks and Shadow Finance in New Sanctions Push

The UK has announced a new package of sanctions targeting cryptocurrency exchanges and illicit financial networks used by Russia to bypass existing restrictions and funnel money into its war effort in Ukraine.

As Western sanctions continue to squeeze Russia’s economy — Moscow slashed its growth forecast for 2026 from 1.3% to 0.4% this month, and halved its projection for 2027 — the Kremlin has increasingly turned to shadow financial systems to keep its war machine funded. The UK government’s latest measures, which came into force immediately, are designed to close those routes. The full announcement is available on the UK government website.

The A7 Network

At the centre of the new package is the so-called A7 network — a Kremlin-backed system built specifically to circumvent Western sanctions, finance military procurement, and process revenue from Russian oil sales. The network claimed to have moved more than $90 billion last year, a figure roughly equivalent to half of Russia’s annual military expenditure.

The UK’s 18 new designations target individuals and entities linked to A7, including a Kyrgyz bank suspected of facilitating payments for the network. Britain is also sanctioning a major global cryptocurrency exchange it believes has channeled over $1.5 billion back into Russian hands, as well as three Georgian companies operating Russia-focused exchanges that authorities suspect are being used to evade existing restrictions.

Cryptocurrency as a Sanctions Loophole

The package reflects a broader shift in how Russia is adapting to international pressure. With traditional financial channels increasingly blocked, the Kremlin has turned to cryptocurrency networks and opaque cross-border payment systems to keep funds flowing. The UK’s action signals that Western sanctions regimes are now actively tracking and targeting this infrastructure rather than focusing solely on conventional banking and trade.

Foreign Secretary Yvette Cooper was direct in her assessment: “If the Kremlin thinks it can evade our sanctions by hiding behind crypto networks and shadow financial systems, it is gravely mistaken. We are going after the infrastructure that underpins its war economy at the same time as Ukraine is increasing the pressure on Russia on the battlefield.”

The Broader Sanctions Picture

The UK has now sanctioned more than 3,300 individuals, businesses, and vessels since Russia’s full-scale invasion of Ukraine. The cumulative economic impact of international sanctions on Russia is estimated at over $450 billion — roughly two years’ worth of funding for the war at current expenditure levels.

The UK framed the latest action as part of a sustained and evolving effort, acknowledging that Russia is actively expanding its evasion networks globally and that the response must adapt accordingly. Cooper said there would be “no safe havens for those enabling Russia’s aggression” and that Britain would continue working with allies to protect the integrity of the international financial system.