OFSI Tightens the Net on Crypto Sanctions Evasion

The Office of Financial Sanctions Implementation (OFSI) has signalled a clear escalation in its approach to cryptoassets, confirming that digital assets are now firmly embedded within the UK’s sanctions enforcement perimeter. In a blog published on 28 January 2026, OFSI outlined how sanctions enablers are increasingly attempting to exploit cryptoassets to move and conceal illicit funds, and how UK authorities are responding through coordinated, intelligence-led action.

Central to this effort is OFSI’s collaboration with the Crypto Cash Fusion Cell CCFC, a pilot multi-agency initiative designed to improve the identification and disruption of criminal abuse of cryptoassets. The CCFC brings together the National Crime Agency NCA, Metropolitan Police Service, His Majesty’s Revenue and Customs HMRC, Financial Conduct Authority FCA, City of London Police and OFSI. This operational model reflects a growing recognition that crypto-related sanctions evasion sits at the intersection of financial crime, regulatory oversight and national security.

OFSI confirmed that it has shared detailed intelligence with the CCFC to support joint investigations into specific, prioritised targets. This intelligence-led collaboration has already resulted in action against potential breaches of UK financial sanctions involving cryptoassets by UK-based individuals. Notably, the operation involved real-time intelligence sharing between government agencies, law enforcement and private sector partners, including blockchain analytics firm Elliptic, enabling rapid conversion of complex data into operational outcomes.

The emphasis on partnership with the private sector is particularly significant. Blockchain analytics providers are increasingly critical to enforcement capability, offering the tools required to trace transactions across decentralised networks. OFSI’s explicit reference to this collaboration reinforces the expectation that compliance in the cryptoassets sector is a shared responsibility, extending beyond regulators and law enforcement to industry participants and service providers.

OFSI’s message to the market is unambiguous. Cryptoassets are not treated as a regulatory grey area or a lesser risk channel. The use of digital assets to evade sanctions is viewed no differently from abuse of traditional currencies, and OFSI has made clear that it stands ready to investigate and pursue sanctions offences involving cryptoassets with the full weight of its enforcement powers.

This development marks an important shift from policy and guidance into active, operational enforcement. OFSI’s engagement with the CCFC demonstrates how sanctions enforcement is becoming more proactive, data-driven and integrated across agencies. For cryptoasset businesses, financial institutions and compliance professionals, the direction of travel is clear: sanctions compliance expectations in the crypto sector are tightening, and reliance on perceived anonymity or regulatory lag is no longer a viable strategy.

OFSI has encouraged firms to engage with its Threat Assessment Report on sanctions compliance in the cryptoassets sector, which provides further insight into the evolving risk landscape. Taken together, the report and the CCFC collaboration underline a simple reality. Every crypto transaction leaves a trace, and UK authorities are increasingly well-equipped, coordinated and determined to follow it.

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