February 22, 2022
By Priyanka Shetty
The long-awaited draft on cryptocurrency regulations has been finally submitted by Russia’s Ministry of Finance after the government approved the concept of creating legislation specifically for cryptocurrencies.
Here’s what you need to know:
- The Russian government and central bank have been debating cryptocurrency for some time. The central bank isn’t on board with the idea of regulating crypto despite Russia being in the 3rd position of the global crypto mining industry and continues to demand a blanket ban on crypto mining in the country.
- On Jan. 25, when the Ministry of Finance favored a complete ban of crypto mining, Russian President Vladimir Putin entered to call out for a compromise. Putin said he acknowledges the risks involved in investing in cryptocurrencies. However, the central bank will not be an impediment in the way of “technical progress” citing Russia’s “competitive advantages” in crypto mining.
- A local news source states that, in the new proposal, the bank suggested that the use of cryptocurrencies only be limited as an investment option for the citizens. “The use of digital currencies as a means of payment on the territory of the Russian Federation will continue to be prohibited,” the Ministry of Finance said. In fact, crypto exchanges are required to meet some criteria to get a license and be registered with the government while emphasizing mandatory KYC.
- In order to protect people from falling for scams, citizens looking to invest in crypto will need to pass an exam that assesses their knowledge on investing, according to the statement. So, those who pass will be allowed to invest 600,000 Russian rubles a year in crypto (about $7,505) and the ones who fail will be limited to just 50,000 rubles.
- The proposed bill also touches upon many other points such as details on corporate governance, reporting, information storage, internal control and audit, risk management measures, and the amount of reserves that need to be held. However, there are no details on how the Bitcoin mining industry would be regulated in Russia.
About the author
Based in Bengaluru, Priyanka Shetty is a freelance writer for Blockchain Asset Review