Russia’s recently revised “On Digital Currency” bill limits crypto purchases for unqualified investors while providing a legal basis for some cryptocurrency payments, according to local media. The bill, proposed by the Russian Ministry of Finance, also introduces strict requirements for platforms operating with digital assets.
Russian citizens who don’t pass the test only buy $600 worth of crypto a year
Russia’s Ministry of Finance recently submitted to the government an updated version of its “On Digital Currency” bill designed to comprehensively regulate the country’s crypto market. Details of the law’s provisions surfaced in Russian media this week.
According to the draft, qualified investors, or “professional digital currency buyers” as they are now described, will have unlimited access to crypto-assets. Ordinary Russians, however, will be able to purchase a maximum of 600,000 rubles (about $7,000) of cryptocurrency each year. And that’s after passing a special exam.
Russian residents who do not pass the test will only be allowed to acquire coins with a total value not exceeding 50,000 rubles per year (about $600 at the current exchange rate), Interfax news agency revealed, citing a source close to the document.
The new law defines the term “digital currency” as “a set of electronic data contained in an information system that can be accepted as a means of payment that is not the monetary unit of the Russian Federation, or as a investment”. Digital currency is considered property in Russia, the report notes.
The wording appears to provide the legal basis for the use of cryptocurrencies in payments. But at the same time, the draft law stipulates that Russian legal persons, including branches of foreign companies and international organizations established in Russia as well as persons staying in the country for at least 183 days in 12 months, shall not may not accept digital currency as payment for goods. and services.
The Ministry of Finance has pushed to legalize the circulation of cryptocurrencies in Russia while the central bank has opposed the idea and suggested banning crypto-related activities such as issuance and trading digital parts. Most other institutions in Moscow support Minfin’s approach, but there is also a general consensus against allowing payments in any currency other than the rouble.
Russia to introduce strict standards for cryptocurrency companies
The draft law “On digital currency” will impose strict requirements on crypto platforms working in the Russian Federation. A “foreign exchange operator”, which offers purchases and sales of digital currency for its own account and at its own expense, will have to maintain at least 30 million rubles of capital. The mandatory threshold for “operators of digital trading platforms” or those “conducting organized auctions” is 100 million rubles.
If the bill is passed as is, these companies will have many other responsibilities, including preparing annual reports, keeping records of digital currency owners, storing and backing up daily trading data, and performing internal audits. Service providers will be added to a special register and their activities will be authorized and supervised by an authorized body appointed by the government.
The requirements are “extremely overstated” and only the largest financial institutions will be able to meet them, blockchain lawyer Mikhail Uspensky commented for the Kommersant. Also, only Russian entities will be allowed to apply for the role of Crypto Operators. Foreign exchanges, for example, will have to establish a local subsidiary to obtain a license, but many of them could be prevented from doing so by the imposition of Western sanctions following Russia’s war in Ukraine.
Citing the project, the Russian business daily also disclosed that only identified users will be able to buy and sell digital currencies. Deposits and withdrawals from Fiat will be possible exclusively via bank accounts and crypto platforms will be required to report suspicious transactions to the financial watchdog Rosfinmonitoring. “E-wallets for digital currencies” will be subject to mandatory certification, although this only applies to wallets within the Russian cryptographic infrastructure.
The “On Digital Currency” bill allows businesses and individual entrepreneurs to engage in crypto mining, once they register with the government. Registration is not compulsory for individuals who mint digital coins if the electrical energy consumed for this purpose does not exceed certain limits which will be determined by the competent authorities.
If Russian lawmakers approve the law, it is expected to come into force on January 1, 2023. The State Duma, Russia’s lower house of parliament, is also currently considering amendments designed to regulate the taxation of crypto-related operations in the country. . .
Do you think Russia will implement the strict regulations for crypto platforms envisaged in the bill “On Digital Currency?” Share your expectations in the comments section below.
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