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China Responds to EU Crypto Sanctions with Targeted Bank Measures

China has taken significant retaliatory steps against the European Union (EU) by imposing sanctions on two Lithuanian banks.

This decision is in direct response to the EU's sanctions aimed at Chinese financial institutions that allegedly provided cryptocurrency services to Russia.

Effective August 13, 2025, the Ministry of Commerce has prohibited any business dealings between Chinese entities and UAB Urbo Bankas and AB Mano Bankas.

Interestingly, both banks have minimal operational ties with China, implying that the sanctions may carry more symbolic weight than economic impact.

The backdrop of these tensions includes a broader diplomatic dispute between China and Lithuania, primarily over Taiwan-related issues.

Following Lithuania's decision to host a Taiwan representative office, relations between the two nations have significantly soured.

The EU is currently evaluating China's sanctions and is looking for potential resolutions to the ongoing conflict.

Officials in Brussels assert their openness to dialogue while expressing concern over the implications of such retaliatory measures.

Both parties are utilizing financial sanctions as a strategy to exert economic pressure and influence political outcomes.

This situation underscores the emerging trend of governments leveraging cryptocurrency regulations as tools in international relations and economic warfare.