BRUSSELS, June 9 -- For two years the European Union played a naming game with Russia's shadow crypto network, and the network kept winning. Brussels would sanction an exchange, the exchange would collapse, and a successor would surface within weeks on the same servers, with the same clients, sometimes with the same staff. The 21st Russia sanctions package, unveiled Tuesday by European Commission President Ursula von der Leyen, is a bet that the only way to stop that cycle is to stop naming names altogether.

For the first time, the Commission is proposing the legal authority to impose a full operational ban on crypto-asset service providers in any third country found to be systematically helping Russia evade EU financial restrictions. Th...