Banca d’Italia has required payment service providers and crypto-asset service providers in Italy to strengthen procedures for enforcing European Union and domestic restrictive measures. Firms must screen the sender and recipient before transferring funds or crypto-assets, including for low-value transactions, and ensure no amount-based settings in internal or third-party systems exclude transfers from review. Sanctions breaches and evasion are subject to criminal penalties. The notice reinforces obligations under EU Regulation 2023/1113, European Banking Authority guidance and existing travel-rule and sanctions-screening requirements, rather than creating a separate sanctions regime. Exemptions available to payment providers for certain instant payments do not apply to crypto transfers, while MiCA authorization does not replace compliance with EU restrictive measures. The action comes amid scrutiny of crypto’s use by sanctioned Iranian and Russian entities: CertiK said the ruble-backed A7A5 stablecoin processed $110 billion in cumulative transactions from February 2025 through May 2026, while TRM Labs reported more than $3.8 billion in flows between CoinEx and sanctioned Iranian entities over more than seven years.