UK Cracks Down on $9.3B Crypto Network Fueling Russian Evasion

The United Kingdom has announced new sanctions against a range of Russian and Kyrgyz entities, including crypto networks and financial infrastructure, that it alleges are being used to circumvent Western economic restrictions imposed on Russia due to its invasion of Ukraine. Among the measures are sanctions on an estimated $9.3 billion rouble-backed stablecoin network, A7A5, which operates on Kyrgyzstan's financial landscape. This action expands the UK's cumulative sanctions against Russia to over 2,700 entities and individuals, aligning with a similar move by the U.S. Treasury last week [1].

The A7A5 stablecoin, which mimics the Russian ruble onchain, has reportedly processed over $9.3 billion in transactions over the course of four months, according to the UK government. The targeted infrastructure includes two Kyrgyz crypto exchanges, Grinex and Meer, alongside other entities linked to A7A5. The UK claims these platforms facilitate illicit transactions and enable the Kremlin to undermine the effectiveness of sanctions [1]. Alongside the crypto sector, the UK also imposed sanctions on the Capital Bank of Central Asia and its director, Kantemir Chalbayev, whom it accuses of supporting Russian military procurement [2].

The UK sanctions extend to a Luxembourg-based firm, Altair Holding, and several other Kyrgyz entities including CJSC Tengricoin and Old Vector. Additionally, individuals such as A7A5 director Leonid Shumakov, were also blacklisted. Sanctions Minister Stephen Doughty emphasized the UK’s stance against such financial evasion tactics, stating that the Kremlin's attempts to launder transactions through “dodgy crypto networks” would not go unanswered [1]. Grinex, in particular, has drawn attention as a potential successor to the previously sanctioned Garantex platform, which was subjected to a $27 million USDT freeze by Tether in March [1].

The U.S. has also taken action against these entities, with the Treasury’s Office of Foreign Assets Control (OFAC) redesignating Garantex and sanctioning Grinex alongside three executives and six Russian and Kyrgyz companies. These entities were accused of facilitating illicit transactions. The timing of the UK's sanctions coincides with a high-level diplomatic meeting in Washington, where U.S. President Donald Trump, Ukrainian President Volodymyr Zelenskiy, and other European leaders, including British Prime Minister Keir Starmer, discussed ongoing efforts to counter Russian aggression [2].

In response to the UK's actions, Kyrgyz President Sadyr Japarov contested the sanctions, arguing that they politically motivated and economically damaging to his country. Japarov denied any allegations that Kyrgyz banks were aiding Russian evasion efforts, asserting that only the state-owned Keremet Bank, which had previously been sanctioned by the U.S., engages with Russian ruble transactions [1]. He emphasized Kyrgyzstan's commitment to international economic standards, stating that the country is prepared to fulfill its international obligations and avoid any reduction in its economic development potential due to external pressures [1].

Source:

[1] UK Sanctions Kyrgyz Bank, $9.3B Crypto Network Tied to ... (https://cointelegraph.com/news/uk-sanctions-kyrgyz-bank-9-3b-crypto-network-used-by-russia)

[2] UK targets Russian crypto networks and Kyrgyz firms in ... (https://www.reuters.com/business/finance/uk-targets-russian-crypto-networks-kyrgyz-firms-new-sanctions-2025-08-20/)