The Russian government and Bank of Russia have now come to common ground to regulate crypto assets as a form of currency.
According to a Wednesday report by local media outlet Kommersant, both parties will draft a bill by February 18, that will recognize crypto assets “as an analog of currencies and not digital financial assets (DFA).”
Russia to Make Crypto Legal
The use of crypto assets in the legal sector will only be allowed with full identification, via the banking system, or licensed intermediaries. Transactions above 600,000 rubles ($7,992) will be recognized outside the legal sector and declared illegal in the country under the Criminal Code law. Penalties will be imposed for illegal acceptance of digital assets as a means of payment, the report stated.
Notably, crypto mining operations are not included as part of the discussion.
“It is highly likely that at least part of the new regulations will come into effect in the second half of 2022 or from 2023,” the report stated.
Russia Will Not Ban Crypto
Recall that there have been conflicting options by Russia’s financial watchdogs on regulating crypto assets in the country. While the country’s central bank has been pushing for an outright ban on crypto, the Finance Ministry sees the need to regulate the emerging asset class rather than ban them totally.
Last month, the Bank of Russia called for a total ban on the use of crypto assets, saying that its volatile nature makes it risky for investors and that it poses a threat to the country’s financial stability. In addition, the bank stated that digital assets are used in facilitating illicit activities like money laundering and terrorist financing.
Russia to Prepare Crypto Bill Next Week
Shortly after, the department director of the Russian Finance Ministry, Ivan Chebeskov, stated that regulations to accommodate crypto and also protect investors in the process should be put in place rather than banning them completely.
Both parties have now reached a consensus to regulate crypto, as Russia’s president, Vladimir Putin, suggested, and will prepare a bill by February 18, 2022.
