Russian ban on cryptocurrencies could come into force by September

Last updated: April 28, 2024, 7:30 p.m. EDT | 3 minutes of reading

A Russian “ban” on cryptocurrencies could be implemented as early as September 1, the country’s top lawmakers have confirmed.

Talk to the media NSNChairman of the State Duma Committee on the Financial Market Anatoly Aksakov said lawmakers would vote in the coming weeks on a “ban on organizing the circulation of cryptocurrencies.”

“Cryptocurrency ban” in Russia: what we know

Aksakov said the bill will stipulate that “only digital financial assets issued in Russian jurisdictions” will be exempt from the new law.

These assets will include several securities issued by Russian banks Blockchain-Powered Digital Coins and the Central Bank’s Digital Ruble Project.

The bill is unlikely to face major opposition in the State Duma, provided it has the full support of the Central Bank and government ministries.

The bank has already called for a “total” ban on crypto along the lines of China, a move strongly contested by key ministry heads.

The ministries have already called for a more Western, Japanese and South Korean approach to crypto regulation, with highly regulated domestic exchanges.

The new bill seems more like a compromise.

The Central Bank has previously indicated that it is ready to make certain concessions to companies that find it difficult to trade abroad due to policies pursued by the United States and the EU. punishments.

Minors exempt?

Aksakov explained that the new bill “proposes a ban on the organization of circulation of [cryptoassets] in Russia.”

Exceptions, he said, will only be made for miners, mining pools and “test projects” under the supervision of the Central Bank.

A Central Bank vehicle on a Russian road. (Source: Georg Pik)

Aksakov previously granted that some Russian companies are already using crypto as a payment tool in international trade agreements.

But the bank seems to want to attract these companies under its influence. Governor Elvira Nabiullina has repeatedly stated demanded that crypto should not officially “enter the Russian economy.”

Russian crypto experts said lawmakers were “actually talking about a ban on transactions involving Bitcoin (BTC) and other cryptocurrencies. Aksakov, meanwhile, said:

“A ban is necessary because, currently, cryptocurrencies have become a kind of quasi-currency that replaces the ruble in this country. But only the Russian ruble can be considered a legal monetary unit. And that’s why we made this decision.

Are alarm bells ringing for Russian crypto users?

Aksakov did not announce that the bill would force Russian banks to refuse transactions related to crypto exchanges.

However, it appears that such a clause could well be included in the final bill. This would pose a major problem for the millions of Russian crypto users living in the country.

Deputy Chairman of the State Duma Committee on Information Policy Anton Gorelkin struck a slightly more optimistic note in a speech post on his Telegram channel.

Gorelkin claimed that the bill would not ban the “circulation of cryptocurrencies in Russia.”

Russian lawmaker Anton Gorelkin.

Instead, the lawmaker asserted that only “traffic organization will be prohibited” under the new bill.

He said the law would instead seek to crack down on illegal crypto exchanges operating outside the Central Bank’s new “Experimental Legal Regime (EPR)”.

The lawmaker claimed that “providing businesses with unfettered access” to the crypto sector would make them vulnerable to “Western sanctions.”

Gorelkin noted that the ban could be subject to future “revisions” and wrote:

“It’s a paradox, but the [proposed] ban on organizing the circulation of [cryptoassets] is a fairly protectionist measure.

It seems likely that the EPR will oversee the sale of coins from industrial crypto miners to foreign buyers.

Rosfinmonitoring, Russia’s main anti-money laundering regulator, has previously stated that it is “monitor” over 25,000 domestic crypto users.

And Rosfinmonitoring too called on the government to accelerate the rollout of crypto regulations after the Financial Action Task Force (FATF) lowered Russia’s compliance rating due to “insufficient regulation of virtual assets and cryptocurrencies.”

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