The US has sanctioned crypto-mining firm Bitriver to prevent Russia from bypassing energy export bans

The US is trying to block funding for the invasion of Ukraine by adding a company to its list of sanctions against Russia.

Bitriver and 10 of its subsidiaries in Russia are among 40 Russian entities and individuals that the US Treasury is targeting with new sanctions.

The Treasury said it was the first time the US was targeting a virtual currency mining company.

Bitriver did not reply immediately. Bitriver is based in Switzerland and was founded by a Russian businessman. It has more than 200 staff across three Russian offices and other markets, according to its website.

Western countries have imposed sweeping sanctions on Russia since the start of the invasion of Ukraine, targeting the country's largest financial institutions, tech companies, Russian President Vladimir Putin and many of his cronies.

The US wants to cut off Russia's ability to monetize their energy in other ways.

Russia is the third-biggest in the world in terms of the amount of money being spent on cryptocurrencies, according to the Treasury. China banned the use of criptines in 2021.

The International Monetary Fund said in a recent report that the risk is fairly contained for now. According to the report, global monthly revenue from mining the digital currency last year was over $1 billion, with Russia accounting for over 10%.

The computing systems that underpin the bitcoin network are operated by cryptocurrencies miners. They go through a process to solve puzzles. The first person to figure out the puzzles will get a reward. Bitriver hosts miners at scale, buying electricity at cheaper wholesale prices.

Russia has cheap energy resources and a cold climate that makes it cheaper for companies to mine from there. This injects foreign funds into Russia.

The United States is committed to ensuring that no asset, no matter how complex, becomes a mechanism for the Putin regime to offset the impact of sanctions.

Cryptocurrencies are thought to have supported terrorist financing.

The UN accused North Korea of raising $2 billion through raiding cryptocurrencies to fund its weapons of mass destruction programs. The government denied the allegations. A report by Elliptic found that Iran could raise up to $1 billion a year through the use of bitcoins.

Transkapitalbank, a Russian privately-owned commercial bank, and companies related to Russian billionaire Konstantin Malofeyev are on the Treasury's latest list of sanction targets.