Like India, Russia To Regulate Crypto And Not Ban Them

Russian authorities have agreed with the finance ministry to regulate the crypto sector and not ban it. Part of an announcement from the government states that “regulating the crypto industry will provide a framework of operation for the industry. Hence, all activities within the industry can be considered legal.”

Resolving Technical Differences

Following a disagreement between Russia’s apex bank and the ministry of finance, President Putin ruled that the two financial agencies should resolve their differences as quickly as possible. Part of their resolution was to legalize this asset category as an alternative medium of exchange.

Today, various local media outlets disclosed that Russia’s apex bank and the presidency have reached an accord on the regulation of digital assets and have put their resolutions into a bill for the legislature to check and approve. The popular Russian news outlet, Kommersant, revealed that the proposed bill is expected to be delivered to the legislature before the end of next week. The bill considers BTC, ETH, and other digital currencies as alternate currencies instead of digital assets.

Some Highlights From The Proposed Bill

Part of the proposal further states that only registered third-party institutions will be allowed to distribute and circulate these digital currencies. The proposed bill also states that it is compulsory for anyone involved in crypto transactions of more than 6K Rubles ($8K) must declare details of their transactions to the appropriate finance agency.

Otherwise, they would be deemed to have committed a criminal offense. Also, when the proposal is approved by the legislature, using cryptos as a payment method will become illegal. The government further stated that “the primary objective of this proposed bill is to create a framework for the inclusion of virtual currencies into our finance landscape and fully control cash flow among our financial institutions.”

The Ban Vs Regulation Debate Has Been An Ongoing Issue

Regulating or banning the crypto industry has been a hot topic among several Russian forums for nearly a year now. The debate became a heated argument when Russia’s apex bank proposed a total ban on digital assets. The bank of Russia claimed that crypto would constitute a serious menace to the nation’s financial infrastructure. 

The bank further claimed that most crypto transactions are usually for money laundering and other illegal financial purposes. Conversely, Russia’s finance ministry issued a statement through its spokesman, Ivan Chebeskov, saying a better alternative to the apex bank’s blanket ban is for the government to regulate activities in the industry.

After serious back and forth debate between the two finance agencies, the presidency had to issue an executive order. The order was for both agencies to hold a meeting to reach an agreement on the best way forward for the nation.

Russia is following the footsteps of India, which recently passed a law taxing crypto-related income at 30%. India is also seeking to launch its national digital currency soon, which might explain its reason for taking such steps. Many analysts also believe that Russia is making a similar decision to launch its digital rubles.

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