UK Sanctions Huobi Global S.A. and HTX Operator in Crackdown on Russia Crypto Networks

The United Kingdom sanctioned Huobi Global S.A., the operator of the HTX exchange, and 18 other entities and individuals as part of a crackdown on Russia crypto networks, with the UK saying the targets were part of Russia’s “illicit financial infrastructure used to move funds, procure goods, and sustain its war.”

“The UK government has sanctioned crypto exchange HTX under its Russia sanctions regime, accusing the platform of providing financial services connected to entities linked to the Russian economy”

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CoinDesk reported that the sanctions took effect immediately and that the package targeted “18 entities” including Huobi (HTX) and a stablecoin issuer, while requiring U.K. financial firms to freeze funds and trace transactions.

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The UK’s sanctions package focused on the Kremlin-backed A7 payments network, which British officials said moved more than $90 billion last year, and Elliptic said the UK applied Regulation 17A of the Russia (Sanctions) (EU Exit) Regulations 2019 to cryptoasset exchanges for the first time.

Elliptic described Regulation 17A as imposing far-reaching restrictions on correspondent banking relationships and payment processing, and it said the implications for UK VASPs and institutions were “immediate and severe.”

Elliptic said the Regulation 17A prohibition captures any transaction where a designated exchange appears in the payment chain, even if the sending and receiving account holders are not themselves sanctioned.

Elliptic further stated that “Payment processing is banned across the chain,” meaning UK firms are prohibited from processing payments where the funds have been previously processed by, or are intended for, an entity designated under Regulation 17A.

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CoinDesk reported that under the rules, U.K. financial firms and crypto service providers cannot maintain correspondent relationships with the designated entities or process payments tied to them, and it said companies may need to freeze funds and trace blockchain transactions linked to sanctioned platforms.

CoinDesk also said Elliptic warned the rules could require firms to trace transactions across multiple blockchain “hops,” extending compliance checks beyond direct counterparties to wallets and exchanges appearing anywhere in a transaction chain.

The UK sanctions package accused HTX of providing financial services connected to entities linked to the Russian economy, including A7 and Garantex, and it said the measures were designed to stymie Russia’s war effort.

“The official account of the Spanish Embassy in Bosnia and Herzegovina on X was spotted asking for information about crypto airdrops and updates on crypto projects”

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CoinDesk reported that Elliptic said the platform is suspected of providing services to both the A7 payments network and Garantex, and it noted that Garantex rebranded to Grinex earlier in the year and halted operations after a $13 million “state-backed” hack.

Hindustan Times said the Foreign Office described the A7 network as “a Kremlin-backed system designed to bypass Western sanctions, finance military procurement, and process funds from the sale of oil to fund its war economy,” and it added that the network claimed to have moved more than $90 billion last year.

Hindustan Times also said the Foreign Office estimated that the group used a Kyrgyz bank and a major cryptocurrency exchange platform to channel $1.5 billion back into Russia, while CoinDesk reported that it reached out to Huobi for comment but did not hear back by press time.