The United States and a long list of allied nations will sanction gold transactions from Russia’s central bank, part of a raft of punitive measures imposed following Moscow’s attack on Ukraine. The bank is believed to keep up to $140 billion in the precious metal, or around 20% of its total holdings.

President Joe Biden announced the new penalties on Thursday during the first leg of a major trip to Europe, after meeting with allies in the Group of Seven (G7) and European Union. The US Treasury Department later elaborated on the decision, noting it would target gold transactions which might be used to “circumvent US sanctions.”

“It is another way to close sanctions loopholes, and increase economic pressure on Russian entities,” Rachel Ziemba, an adjunct senior fellow at the hawkish Center for a New American Security (CNAS), told the Associated Press. 

However, some analysts have disputed whether the new sanctions will have the intended effect, arguing that Russia will still be able to deal in precious metals.

“Any sanctions on Russia’s gold reserves would do little more than reveal the degree to which government bureaucrats don’t understand gold,” Brien Lundin, editor of Gold Newsletter, said in an interview with MarketWatch.”The beauty of gold, unlike currencies, is that it is an untrackable store of value that has no counterparty.” 

Along with the penalties on gold transactions, the Biden administration placed sanctions on 400 individuals and “entities comprised of Russian elites,” boasting that it “has now sanctioned over 600 targets” in total.

“Our sanctions on Russia are unprecedented – in no other circumstance have we moved so swiftly and in such a coordinated fashion to impose devastating costs on any other country,” the White House said, after previous vows to isolate and cripple the Russian economy in retaliation to its assault on Ukraine in late February.