The Russia’s Ministry of Finance communicated it’s plan to push forward with regulation of cryptocurrencies in the country, and has introduced a bill to parliament. According to a press release, the approved roadmap presents a plan to regulate the country’s cryptoeconomy.
Bitcoin sparked a revolution by proving the ability to create digital scarcity: a unique and finite digital asset whose ownership could be proven with certainty. This innovation laid the foundation for an open financial system. Today, all forms of value – from those natively created online such as in-game digital goods to traditional securities like equities and bonds – can be represented digitally, as crypto assets. Like the bits of data that power the internet, these crypto assets can be dynamically transmitted, stored, and programmed to serve the needs of an increasingly digital and globally interconnected economy.
The challenge the within regulators, is that the Bank of Russia, which opposes regulation and would rather see cryptocurrency trading and mining banned. The central bank, which has been pushing forward the pilot of its central bank digital currency, the digital ruble, has suggested punishing crypto trading and issuance with fines up to 500,000 rubles ($6,360) for individuals and 1 million rubles for companies, TASS news agency reported.
In the press release, the Ministry of Finance said the objections of the Bank of Russia “will be considered in the further work on this bill where they don’t contradict the Ministry of Finance approach.”
The bill treats crypto as an investment tool, not a legal tender, and says cryptocurrencies may not be used to pay for goods and services. It also specifies requirements for cryptocurrency exchanges and over-the-counter desks, which must satisfy certain criteria to obtain a license and be included in a dedicated government register. Foreign crypto exchanges must register legal entities in Russia to provide services in the country.
All cryptocurrency-to-fiat transactions must be conducted through bank accounts, and users must go through know-your-customer (KYC) checks with both banks and cryptocurrency exchanges, the press release said.