Can Russia Circumvent EU Sanctions Through Cryptocurrency?

Russia has seemingly turned to cryptocurrency since the West decided to ‘punish’ the nation for its invasion of Ukraine. US and EU imposed sanctions against Russia to cut it off from global traders. With the popularity of crypto it is possible for Russia to get around these sanctions.

Russia could turn to cryptocurrency

The fact that cryptocurrencies like Bitcoin are decentralized is one of the reasons that investors have chosen them. Decentralized currencies are not managed by any entity. They are immune to sanctions, regardless of their severity. This makes it appealing to people who are trying to evade detection from governments.

Russia has begun to embrace crypto recently to encourage trade in the face of sanctions. Most prominent among these are the Russian sanctions against gas purchases. It opens the door to the possibility for the country to accept cryptocurrency as payment for oil and gas. Vladimir Putin might be able evade all these restrictions and bypass the existing banking system by using Bitcoin as a cryptocurrency. 

Back in September, the US Treasury’s assistant secretary for Terrorist Financing and Financial Crimes, Elizabeth Rosenberg, told lawmakers that it was possible for the Kremlin to actually evade sanctions levied against it. Elizabeth Warren, Senator, also expressed concern about this, noting that North Korea was using sanctions to avoid them already. Russia could do the exact same.

Crypto total market cap chart from

 Source: Crypto Total Market Capital| Source: Crypto Total Market Cap on

Still An Important Player

Although there are sanctions currently against Russia, EU relies heavily on oil and gas supplied by the Kremlin. Despite their support for Ukraine during the conflict, European companies continue quietly to source products from Russia.

It is easy to see why Russia could have a lot of customers if they switched to cryptocurrency payments to pay for their oil and gas. Russia is an already established company in the oil-and gas sector and it will be difficult for companies to switch suppliers. Instead of spending thousands of dollars changing international suppliers, it makes more sense to undergo the small inconveniences of fiat conversion to crypto.

Since the start of war, Russia has already begun to soften its position on cryptocurrency. It was revealed that in September the government and the central bank had agreed on a rule allowing residents to use crypto for cross-border payments. Trade Minister Denis Manturov said back in May that the country would legalize digital asset payments “sooner or later.”

Featured image taken from Chart from

Follow Best Owie on Twitter for market insights, updates, and the occasional funny tweet…

Get more Crypto News at CFX Magazine