Across Europe, the Middle East, and the UK, regulators are sending a clear message: crypto activity must operate within established rules. This week’s stories, from potential EU sanctions on a ruble-backed stablecoin to Dubai’s enforcement actions and the Bank of England’s changing tone on stablecoins, reflect growing global coordination between innovation and accountability.
EU weighs sanctions on Russian ruble-backed stablecoin A7A5
The European Union is preparing a new round of sanctions targeting A7A5, a ruble-backed stablecoin launched earlier this year that has quickly become the world’s largest non-USD-pegged token.
According to documents reviewed by Bloomberg, the proposed sanctions would prohibit EU-based individuals and companies from interacting with A7A5, either directly or indirectly. The move forms part of a broader EU effort to close loopholes that allow Russian entities to bypass financial restrictions.
A7A5, created by Moldovan banker Ilan Shor in partnership with Russia’s state-owned Promsvyazbank, claims to be backed by fiat reserves held in Kyrgyzstan’s banking system. Despite being banned in Singapore, the token’s market cap surged 250% after the EU’s previous round of crypto-related sanctions in September, reaching roughly $500 million.
Leaked data has now confirmed information first identified by Crystal; that Grinex and Garantex are the same operation. The A7 leaks include multiple references to Garantex, including an internal message reading “Access to Grinex (Garantex)” alongside a link to the exchange’s GitHub repository, further underscoring A7’s operational ties to the sanctioned Russia-based exchange.
The sanctions proposal still requires unanimous approval from all 27 EU member states, but if passed, it would significantly limit A7A5’s access to European markets and further isolate Russia’s crypto ecosystem.
Why this matters:
A7A5’s rise highlights how stablecoins pegged to national currencies can become geopolitical tools, enabling sanctioned regimes to move funds beyond the reach of traditional banking systems. For compliance and investigative teams, this development underscores the growing intersection of crypto assets, sanctions evasion, and national security policy. Monitoring activity around non-USD stablecoins, particularly those linked to high-risk jurisdictions, is becoming a critical component of financial intelligence efforts.
Read more on Crypto News
VARA issues fines and public warnings against unlicensed virtual asset firms
The Virtual Assets Regulatory Authority (VARA) in Dubai has intensified its enforcement program, announcing fines and public warnings against seven unlicensed firms operating within its jurisdiction.
Each entity received cease-and-desist orders and fines ranging from AED 50,000 to AED 100,000 for breaching licensing and marketing regulations. VARA also warned individuals and institutions against engaging with unlicensed firms, citing significant financial, reputational, and legal risks.
VARA’s Enforcement Division stated, “Our priority is to ensure that Dubai’s virtual assets ecosystem remains secure for consumers and investors while being a progressive environment for compliant entities.”
The regulator reaffirmed its commitment to market transparency and investor protection, reminding all operators that only licensed firms may offer or market virtual asset services in or from Dubai.
Why this matters:
VARA’s continued enforcement demonstrates maturing regulatory oversight in the UAE, one of the world’s fastest-growing virtual asset hubs. Compliance officers and VASPs should note that Dubai’s licensing regime is being actively policed, with penalties not limited to domestic entities. The clear message: firms engaging with the UAE market must ensure full regulatory alignment, including marketing and promotional compliance.
Read more on the VARA website
Bank of England signals openness to stablecoins
In a marked shift in tone, Bank of England Governor Andrew Bailey has suggested that stablecoins could play a larger role in the UK’s financial system than previously acknowledged.
In comments published by the Financial Times, Bailey said it would be “wrong to be against stablecoins as a matter of principle,” recognizing their potential to drive payment innovation both domestically and across borders. He also indicated that the financial system “does not have to be organized” solely around commercial banks, hinting at possible coexistence between banks, stablecoins, and non-bank credit providers.
This perspective contrasts sharply with Bailey’s earlier stance, where he described crypto assets as “unsuited to the world of payments.” However, he reiterated that any stablecoin used for payments must meet the same standards as traditional money, covering liquidity, governance, and deposit protection.
Industry experts view this as a pivotal moment.
Why this matters:
The Bank of England’s more constructive tone signals a potential regulatory green light for stablecoins within the UK’s payments infrastructure. For compliance teams, this could mean new supervisory frameworks and reporting requirements on par with traditional financial services. For regulators and law enforcement, it also opens the door to closer integration of blockchain-based payments within regulated environments, reshaping how money and credit interact in the digital economy.
Read more on Yahoo Finance
