It is reported that the European Union is considering imposing sanctions against a ruble-backed stablecoin and the largest non-US dollar stablecoin in the world. The sanctions would prohibit organizations and individuals based in the EU from engaging directly or indirectly through third parties with the token, according to a news agency report on Monday, citing documents related to the proposal. Several banks in Russia, Belarus, and Central Asia are also at risk, accused of allowing sanctioned entities to conduct crypto-related transactions, the report states. This is the latest attempt by the EU to limit crypto movements related to Russia, following the sanctions on September 19, which blocked all transactions for Russian residents and restricted dealings with foreign banks linked to the country's sector. Cryptocurrency is just one of many methods that Russia has used to try to evade Western sanctions. Russia has also used a so-called shadow fleet, hundreds of ships used to smuggle sanctioned goods, obscuring the origin of its oil and conducting intermediate trading through other countries, along with various methods, according to global risk consulting firm Integrity Risk International. At the same time, it is using illegal gold trading operations for money laundering, said global political analysis group Rand in its December 2024 report. The market capitalization of stablecoins surged sharply after the sanctions. A week after the announcement of the EU sanctions against crypto platforms on September 19, the market capitalization of the stablecoin surged sharply on September 26 from around $140 million to over $491 million, representing a 250% increase in one day, according to platform data.

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The market capitalization of the stablecoin increased by 250% a week after the EU imposed sanctions for the first time. The market capitalization of the stablecoin is now steadily holding at around $500 million on Monday, which is about 43% of the total market capitalization of unstable stablecoins at 1.2 billion USD. The Circle's EURC stablecoin, pegged to the euro, ranks second with a market capitalization of about $255 million. EU sanctions require support from all 27 member states before they receive approval, and they can still be modified or changed before coming into effect, according to the report. The European Council describes sanctions as a tool aimed at "those responsible for policies or actions that the EU wants to influence," and a way to "achieve changes in the policies or behaviors of those targeted by sanctions, with the aim of promoting the goals of the EU's Common Foreign and Security Policy." The EU joined the US and the UK with sanctions. EU sanctions followed similar restrictions imposed by the UK and the US in August, targeting parts of the financial sector allegedly used by Russia to circumvent Western sanctions, including Capital Bank of Central Asia and its director, Kantemir Chalbaev. Kyrgyzstan, cryptocurrency exchanges, and the Central Asian country that issues the stablecoin were also blacklisted along with organizations related to the infrastructure supporting the ruble-backed stablecoin. The stablecoin was launched in February on Ethereum and Tron networks by Moldovan banker Ilan Shor and Russia's state lender Promsvyazbank. It was introduced as a "token backed by a diversified portfolio of fiat deposits held in reliable banks in Kyrgyzstan." Despite the sanctions and a ban from Singapore, the company behind the stablecoin appeared at a crypto event where it organized a booth. One of the executives also spoke on stage. However, the organizers later removed the project from the event and their website.