The Office of Foreign Assets Control (OFAC) was formally established in December of 1950 with the original mission of blocking Chinese and North Korean assets within U.S. jurisdictions once China decided to join the Korean War efforts. Due to the success of the agency, it eventually assumed the responsibility of enforcing economic and trade sanctions that support U.S. foreign policy and national security goals.

After decades of successfully leveraging the force of the U.S. to implement and enforce sanctions, cryptocurrency has become problematic for the agency. 

On August 14th, 2025, the agency unveiled a new list of sanctions directed at a number of individuals and businesses that are accused of using stablecoins to evade U.S. sanctions.

Reports suggest that A7 LLC, which created the A7A5 stablecoin, has been transferring up to $1 billion per day, which is enough to raise suspicion on its own. On top of that, though, Ilan Shor owns a majority of the A7 company and its subsidiaries. 

This finding is extremely concerning since Ilan Shor was convicted in 2017 after being caught stealing over $1 billion from three Moldovan banks. Shor has also been sanctioned for his participation in undermining democratic elections in Moldova on behalf of Russia.

Another entity that owns a significant chunk of the A7 company is Promsvyazbank (PSB). This entity is a Russian owned bank known for serving the country’s defense sector. This bank was previously sanctioned by the OFAC for helping Russia’s defense sector evade U.S. sanctions. The bank was also implicated in a large vote buying scam involving pro-Russia candidates in the 2024 Moldovan elections.

Garantex, the crypto exchange used to facilitate sanction evading transactions, is owned by Sergey Mendeleev. This same individual also created the stablecoin “Cryptorouble” and Exved, a trans-border payments platform. Once Exved was sanctioned, it was replaced by Grinex. Grinex has been facilitating the exchange of at least $1.8 billion in crypto transactions.

Sanctioning Cryptocurrencies and Crypto Exchanges

The OFAC has the authority to require crypto exchanges and cryptocurrency issuers to comply with its sanctions. That said, cryptocurrency cannot be used to evade sanctions legally. 

Non-compliance comes with very serious penalties, so it’s paramount that every U.S. business that’s currently utilizing cryptocurrency ensures that they are not doing business with any sanctioned entity, unit, or individual.

A violation of OFAC sanctions could result in both civil and criminal consequences. For one, you’ll likely face serious fines, even if your violation was unintentional. These fines can be excessive, even reaching up to $1 million per violation. On top of these fines, you might also be ordered to pay restitution or face other monetary penalties. Your business assets might also be seized by the government.

If you’re convicted of violating OFAC sanctions, then you could potentially face up to 20 years in prison.

Here at Bukh Global, our team can help you better understand your business’s compliance requirements and needs. Contact our team now by leaving your contact information on our online form now for a free consultation.