The Long-Term Casualty of the Russia–Ukraine War Is the Collapse of the Transatlantic Alliance

The battle over Russian state money parked in a Brussels clearinghouse sounds like a technical footnote in the Russia–Ukraine war. In reality, the fight over the frozen billions at Euroclear risks becoming the earthquake that shakes loose the tectonic plates of the Transatlantic alliance.

At the centre of this shock lies a deceptively simple question: who gets to decide what happens to Russia’s frozen assets—and on whose terms?

A “just enough” plan in an endless war

“The proposal is imminent.” With that dry sentence, the spokesperson for European Commission President Ursula von der Leyen recently raised the temperature in Brussels.

For weeks, diplomats have waited for a detailed Commission text explaining how, in what looks like a war without a clear outcome, the EU intends to keep Ukraine financially afloat. The drafting has taken place in almost total secrecy. The timing of publication depends openly on “how the situation on the ground evolves.”

An IMF study, built on the optimistic assumption that the war ends late next year, calculates that Ukraine will still need about 135 billion euro in 2026 and 2027—after subtracting what Kyiv can scrape together from its own limited resources. Europe has taken that number as its starting point.

Having learned since the Trump era that it can no longer assume the United States will always open its deep pockets, the EU wants to secure that money itself. The obvious target: roughly 210 billion euro in Russian state assets immobilised in Europe under the sanctions regime that followed the 2022 invasion.

About 185 billion euro of that sits at Euroclear in Brussels. Around 176 billion euro is now held as cash, the product of maturing Russian government bonds. The profits on that cash are taxed in Belgium and channelled to Ukraine. Part of the proceeds—about 45 billion euro—has already been invested in a first loan to Ukraine.

Now the Commission wants to go further. It wants to touch the principal.

The draft architecture is brutally simple:

• Around 45 billion euro would be set aside to repay the first loan.
• The remaining 140 billion euro would be passed on to Ukraine as a new, interest‑free “recovery loan”—almost exactly the 135 billion euro the IMF says Kyiv will need in 2026–2027.

On paper, it is elegant: one pot of money, neatly matched to one quantified need.

How to lend Russian money without “confiscating” it

The Commission insists it has found a legal way to do this without formally expropriating Russia.

In its scheme, Euroclear would move the Russian cash into a special European fund. That fund would then lend the money to Ukraine. Legally, Russia would remain the owner of the assets and could get them back—if and when three conditions are met:

1. Russia compensates Ukraine for the damage caused by the war.
2. The EU lifts its sanctions.
3. Ukraine, having received reparations, repays the loan to the fund.

In other words, Russia’s frozen money would stand as a kind of hostage guaranteeing eventual reparations. Ukraine would only have to pay the loan back after it has itself been paid.

On the Commission’s slide deck, this looks neat, reversible, even morally satisfying.

For Belgium, it looks like a legal minefield.

Belgium as the reluctant epicentre

Prime Minister Bart De Wever’s government has been advised by law firms that see the plan very differently. In their reading, shifting the principal into an EU fund and locking it into a long‑term loan looks dangerously close to de facto confiscation of sovereign assets.

The risks they see are stark:

• Russia could launch massive legal proceedings against Euroclear and Belgium.
• Other states might start to question whether their assets are truly safe in European clearing systems.
• Global investors could be spooked by the precedent and quietly pull money out of the eurozone, pushing up interest rates and destabilising the currency bloc.

Euroclear itself has written to von der Leyen warning of the same dangers: reputational damage, litigation, and the risk that the eurozone’s financial core is seen as politically weaponised.

De Wever has compared the situation to the risk of a plane crash. The probability might be small, but if things go wrong, the consequences are devastating—up to and including the effective bankruptcy of Belgium, whose legal system and taxpayers would stand directly in the firing line.

This is why Belgium has ended up cast as Europe’s “troublemaker”: the country on whose territory the assets sit, and the one government not prepared to simply sign off on the Commission’s legal acrobatics.

Growing isolation – but not yet overruled

For a long time, Belgium believed that many capitals quietly shared its doubts. The biggest shock in Brussels came when leading German conservative Friedrich Merz suddenly backed the idea of a large loan backed by Russian assets. Soon after, Luxembourg’s prime minister Luc Frieden came on board.

That was significant. Luxembourg hosts Clearstream, a competitor to Euroclear that also holds Russian assets. If anyone was going to fear contagion, it should have been Luxembourg. Instead, it chose to back the Commission.

Belgium’s isolation is now real—but it is not yet total, and it is not yet fatal.

On the EU summit of 18 December, heads of state and government are expected to take a decision on Ukraine’s long‑term financing. For now, such decisions are still taken by consensus. In other files, creative methods have been found to bypass Hungary’s vetoes. But the sheer size and systemic importance of the Euroclear assets make most capitals reluctant to simply steamroll Belgium.

To impose this “recovery loan” over De Wever’s head, and then see Belgium dragged into ruinous lawsuits, would carry enormous political costs.

So the EU finds itself in a paradox:

• Politically, a majority wants the plan.
• Legally and financially, no one wants to own the consequences alone.

Qualified majority, consensus, and the fault line inside Europe

This is where the debate over qualified majority voting returns.

Some argue that using the EU’s legal “bridge clauses” to extend majority voting to sanctions and asset measures is the only way to stop smaller states holding Ukraine’s future hostage. Others warn that doing so now—on a file that could make or break a member state’s financial stability—would breach a taboo and deepen mistrust inside the Union.

The most likely outcome is a messy compromise:

• Enough elements of the Commission plan are adopted to unlock a big loan to Ukraine.
• Enough legal fig leaves are left in place for Belgium to claim that outright confiscation has been avoided.
• Enough ambiguity remains to keep every lawyer in Brussels employed for the next decade.

But even that “compromise” does not solve the deeper problem: who really leads the West’s strategy on Ukraine—Europe or the United States?

The American angle: competing over the same money

While Brussels wrestles with the details of its recovery loan, Washington has been working on its own peace and reconstruction framework.

Drafts and leaks from U.S. discussions suggest a plan in which a substantial share of frozen Russian assets is harnessed for Ukraine’s reconstruction under American leadership, with U.S. institutions taking a significant role—and a significant share of the upside.

From a European perspective, this looks uncomfortably like competition for control of the same pot of money:

• The EU wants to turn “its” 210 billion euro in immobilised assets into a European‑designed financial backstop for Ukraine.
• The U.S. assumes that, at the end of the day, it will be the senior partner deciding how those assets are used in any peace or reconstruction deal.

No one says this openly. But it explains Washington’s cautious silence on the Euroclear plan, and Brussels’ equally careful wording about “coordination” with allies.

Euroclear has thus become Europe’s biggest implicit stand against the United States since the Iraq war: the place where the EU quietly insists that the main lever over Russian assets on European soil must be in European, not American, hands.

Ukraine: pushed fully into Europe’s arms

For Ukraine, the numbers are stark. If the IMF is right, Kyiv will need at least 135 billion euro just to survive 2026–2027. The EU’s recovery‑loan architecture is designed almost perfectly around that figure.

If the plan goes through, it will be European money, European legal risk, and European political conditions that keep Ukraine afloat.

At the same time, if Washington continues to negotiate its own peace ideas—some of which Kyiv fears could lock in territorial losses or impose limits on its military—Ukraine will quietly tilt ever further toward Europe as its primary patron.

Euroclear, a clearinghouse in Brussels, would then become the hinge on which a historic shift turns:

• away from a U.S.-led peace process,
• toward a Europe‑anchored financial and political settlement.

Russia’s opportunity and NATO’s dilemma

From Moscow’s vantage point, all this is an opportunity.

If the Transatlantic partners fall out over the use of Russian assets, Russia can try to open one channel with Washington—focused on sanctions relief, broader strategic issues, and perhaps selective economic reopening—while pursuing a much harsher confrontational posture toward Europe, portrayed as the thief of Russian state money.

In the long run, that feeds into NATO’s deepest dilemma:

• If Europe takes on most of the financial and security burden for Ukraine, and
• If the United States chooses a narrower, more transactional role in Europe’s security,

then the idea of a NATO where the U.S. is no longer the unquestioned leader becomes thinkable.

A scenario where Ukraine is tied into Western defence structures primarily under European guarantees—with a more limited, conditional American role—moves from fantasy to possibility.

Euroclear, again, is the unlikely trigger.

Can Europe survive the “Belgian earthquake”?

All paths circle back to Brussels.

The “Belgian earthquake” is not just Belgium’s refusal to nod along. It is the way this crisis exposes the EU’s deepest fault lines:

• between large and small states,
• between legal caution and geopolitical urgency,
• between European autonomy and Transatlantic dependence.

Can Europe:

• shoulder a 140 billion euro recovery loan for Ukraine,
• keep financial markets confident in the safety of euro‑denominated assets,
• hold the Union together while experimenting with new forms of decision‑making, and
• do all this without shattering its relationship with Washington?

No clearinghouse was ever meant to answer such questions. Yet the frozen billions at Euroclear have forced them onto the table.

If the Transatlantic alliance does gradually unravel, historians may not start their story in Washington or Moscow. They may begin it in a small country, in a cautious prime minister’s office, and in the back‑end ledgers of a Belgian financial institution that suddenly found itself at the epicentre of a geopolitical earthquake.