Italy’s central bank, Banca d’Italia, has mandated sanctions screening for cryptocurrency transfers in an effort to curb illicit financial flows across the European Union. In a Monday announcement, the central bank stated that crypto asset service providers (CASPs) must establish internal controls and policies to enforce EU financial sanctions during the processing of crypto transactions.
According to the central bank, CASPs should strive to maintain adequate controls capable of identifying customers and transactions linked to sanctioned entities.
The regulatory move comes as cryptocurrencies face increased scrutiny regarding their use by entities in Russia and Iran to evade financial sanctions. Blockchain security platform CertiK reported that the Russian ruble-backed A7A5 stablecoin processed $110 billion in cumulative transactions between February 2025 and May 2026 despite being targeted by Western sanctions.
Additionally, Iran’s central bank has reportedly relaxed foreign currency controls to promote the use of cryptocurrencies, including Tether’s USDt and Bitcoin, for cross-border settlements through Iranian exchanges to bypass sanctions. Enforcement actions have also ramped up internationally; on July 14, US Treasury Secretary Scott Bessent stated that American authorities had frozen over $130 million in crypto held within wallets tied to Iran’s central bank. Furthermore, blockchain analytics firm TRM Labs reported in June that more than $3.8 billion had flowed between crypto exchange CoinEx and sanctioned Iranian entities over a period of more than seven years.
