US, EU and UK authorities are extending sanctions enforcement across crypto exchanges, stablecoins and blockchain networks, forcing international platforms to reassess the markets they serve.
Bitget, MEXC and KuCoin have announced restrictions on users in Russia and Belarus as regulators increase scrutiny of crypto services linked to sanctioned networks.
Chainalysis reported that the value received by sanctioned entities surged 694% in 2025 to $104 billion, highlighting the scale of cryptocurrency activity connected to sanctioned parties.
How Sanctions Enforcement Reaches Crypto Exchanges
Governments impose sanctions after investigating individuals, companies, and financial networks suspected of supporting prohibited activities. Authorities publish their designations through official lists, which can include company names, affiliated entities, and cryptocurrency wallet addresses.
In the US, the Treasury Department's Office of Foreign Assets Control (OFAC) administers these measures. US persons and businesses subject to US jurisdiction must block property belonging to designated parties when it falls within US jurisdiction and avoid prohibited transactions with them.
Crypto exchanges can become involved when investigators trace funds or business relationships to their platforms. Sanctioned individuals may use exchange accounts to hold assets, convert cryptocurrency into fiat currency, or move funds across borders. Authorities use blockchain analysis, financial intelligence, and information from regulated institutions to identify these connections.
Exchanges that facilitate prohibited transactions can face enforcement action, while designated platforms may encounter asset freezes and restrictions. Stablecoin issuers such as Tether and Circle can also freeze tokens at specific wallet addresses, giving authorities another way to disrupt the movement of digital assets.
EU Sanctions Reshape Crypto Services in Russia and Belarus
Russia has faced direct crypto-related sanctions since 2022, when OFAC designated the exchange Garantex. In August 2025, the Treasury redesignated Garantex and sanctioned Grinex, which it described as the exchange's successor, alongside entities connected to the ruble-backed A7A5 stablecoin.
The Treasury said former Garantex employees established Grinex after enforcement disrupted the original exchange. It also targeted Old Vector, the Kyrgyz company behind A7A5. The stablecoin processed an estimated $93.3 billion in transactions during 2025, according to the same research cited earlier.
Belarus has faced separate EU restrictions. In February 2025, the bloc prohibited crypto wallet, account, and custody services for Belarusian nationals, residents, and companies established in the country. It also restricted Belarusian nationals and residents from owning or controlling EU companies providing those services.
The EU expanded its restrictions on Russia in April 2026, introducing a sector-wide transaction ban involving Russian crypto-asset service providers and decentralized trading platforms. The package also prohibited the use of the RUBx stablecoin and Russia's digital ruble.
Its 21st sanctions package, adopted on July 23, extended transaction bans to 14 crypto-related platforms across several countries, including Belarus. It also created a mechanism for imposing full transaction bans on crypto providers in third countries that help Russia evade sanctions. Additional measures targeted Belarusian nationals owning, controlling, or serving on the boards of crypto-asset service providers.
KuCoin Joins Exchanges Restricting Russian and Belarusian Users
The regulatory pressure has coincided with withdrawals by international exchanges. Bitget updated its terms in October to include Russia and Belarus among prohibited jurisdictions, while MEXC announced on October 20 that it would discontinue services in both countries.
KuCoin followed on October 29, announcing that it would discontinue access to its products and services for users in Russia and Belarus. The exchange cited applicable legal and regulatory requirements and gave affected customers deadlines to close positions and withdraw assets. It did not disclose the number of accounts affected or identify a specific sanctions designation behind the decision.
UK and US Enforcement Adds to Pressure on Crypto Exchanges
Regulatory scrutiny also extends beyond sanctions compliance. On October 29, the UK's Financial Conduct Authority (FCA) announced a settlement with HTX, formerly Huobi, following proceedings over unlawful cryptoasset promotions to British consumers.
HTX had already taken steps to exit the UK after the FCA began proceedings in 2025. The settlement secured undertakings preventing the exchange from knowingly promoting its services unlawfully to UK consumers. It did not include an admission of wrongdoing.
The UK plans to bring a wider range of crypto activities under its regulatory framework from October 25, 2027.
In the US, federal prosecutors are investigating Binance over possible sanctions violations involving Iran, according to Reuters reporting in September. The investigation examines whether the exchange knowingly permitted transactions connected to Iranian entities. Binance has denied wrongdoing and said it cooperates with law enforcement.
The case follows Binance's 2023 guilty plea to violating US anti-money laundering and sanctions laws, resulting in a $4.3 billion settlement.
Compliance Pressure Reshapes Exchange Access and Market Liquidity
Restrictions in Russia and Belarus can reduce exchanges' trading activity, transaction fees and revenue opportunities. Platforms must also invest in customer screening, transaction monitoring and legal oversight to manage exposure across jurisdictions.
The consequences extend beyond affected customers. Sanctions exposure can complicate relationships with banking partners, payment providers and stablecoin issuers, potentially affecting deposits, withdrawals and transfers in other markets.
Customers losing access to international exchanges may move to domestic platforms or alternative channels, shifting trading activity across different venues and fragmenting liquidity. The full impact remains difficult to measure because Bitget, MEXC and KuCoin have not disclosed the affected customer numbers or trading volumes.
Regulatory Access Becomes a Business Constraint for Crypto Exchanges
The EU's third-country restriction mechanism gives regulators another way to target overseas providers accused of facilitating sanctions evasion. The UK's 2027 regulatory framework will also require international exchanges to assess the cost of obtaining authorization before serving British customers.
For global crypto exchanges, regulatory access is becoming a business constraint alongside trading volume and liquidity. Restrictions can remove customers and revenue, while enforcement exposure can threaten relationships with the financial institutions and service providers that support international operations.
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