Russia plans to issue its own digital ruble, but the government only recently approved the use of private cryptocurrencies after arguing for years that they could be used to launder money or fund terrorism. The Bank of Russia, the country`s central bank, reportedly admitted that cross-border crypto payments are inevitable under current geopolitical conditions. Russia`s central bank has reconsidered its approach to crypto regulation and agreed with the Finance Ministry to legalize crypto for cross-border payments, local newspaper TASS reported Monday. Deputy Finance Minister Alexei Moiseyev was quoted as saying that the Bank of Russia and the Finance Ministry were expecting cross-border crypto payments soon. In June, central bank governor Elvira Nabiullina said in an interview with RBC that cryptocurrencies could be used for international payments, as long as the assets did not “penetrate” the Russian financial system. Manturov was asked on a forum if he thought cryptocurrencies would become legal as a means of payment. Disclaimer: The opinions of our authors are solely their own and do not reflect the opinion of CryptoSlate. None of the information you read on CryptoSlate should be construed as investment advice, and CryptoSlate does not endorse any project that may be mentioned or linked to in this article. Buying and trading cryptocurrencies should be considered a high-risk activity. Please exercise your own due diligence before taking any action regarding the content of this article. Finally, CryptoSlate assumes no responsibility if you lose money while trading cryptocurrencies. The experimental sales regime is made possible by the Digital Innovation Act adopted in 2020.
The bill includes definitions of cryptocurrency mining and mining pools. It also prohibits the promotion of cryptocurrency in Russia. Deputy Finance Minister Alexei Moiseyev said the policy describes “how to acquire cryptocurrency, what can be done with it” and its use in cross-border settlements. However, central bank governor Elvira Nabiullina said the bank could not welcome investments in cryptocurrencies, which account for about $5 billion in transactions by Russians a year, and proposed banning trade and mining. The new law, Protocol Reports, also requires crypto exchanges and providers to reject transactions where digital payments can be interpreted as a substitute for currency exchanges. However, there is language in the final clause of the act that provides exceptions for certain payments. [1] Roger Huang, Russia withdraws from total cryptocurrency ban, Forbes, (August 10, 2020). www.forbes.com/sites/rogerhuang/2020/08/10/russia-backs-away-from-total-cryptocurrency-ban/?sh=370c32637520 According to a report published Thursday by the Russian publication Kommersant, Russian Deputy Finance Minister Alexei Moiseyev said that the government ministry had “on the whole” agreed with the central bank on a rule that would allow residents to send cross-border payments using cryptocurrencies. The proposed policy change was aimed at giving Russian nationals access to digital wallets. Although Russia has not yet fully regulated cryptocurrencies, the “Digital Financial Assets” law introduced and defined DFAs and UDRs when it came into effect in 2021. On November 17, a bill was presented to the Russian State Duma, the lower house of parliament, that would legalize cryptocurrency mining and the sale of mined cryptocurrency.
Cryptocurrency cannot currently be used for settlements in Russia. Russia has a mixed relationship with crypto. In 2020, the country passed a law banning the use of cryptocurrencies, including Bitcoin (BTC) for payments. President Vladimir Putin also signed a law in July banning digital financial assets as payments. In May, Commerce Minister Denis Manturov suggested that Russia would legalize crypto payments “sooner or later.” Most jurisdictions and authorities have yet to enact cryptocurrency laws, which means that for most countries, the legality of cryptocurrency mining remains uncertain. As of January 1, 2021, cryptocurrency owners whose transaction amount exceeds 600,000 rubles ($7,757) in a calendar year will be required to report their crypto transactions and portfolio balances to the Russian tax authorities. The law also applies to individuals and organizations. Russian government officials have to explain if they have cryptocurrencies.
The notification deadline for these natural and legal persons is 30 April 2022. In addition, crypto exchanges and miners must provide Rosfinmonitoring, the federal financial monitoring service, with information about their cryptocurrency transactions. The Ministry of Finance has stated that regulation is necessary to prevent illegal cryptocurrency transactions, including money laundering. The law will come into force on January 1, 2021. It is a serious criminal offence not to make a declaration twice in three years or to intentionally provide incorrect information to the Russian tax authorities. If a taxpayer fails to report transactions worth 45 million rubles ($615,000) or more in two of the last three years, they risk a fine of 500,000 to 2 million rubles, five years of hard labor, and prison terms ranging from 18 months to five years. Penalties for unreported crypto transactions below 45 million rubles include: fines, forced labor, and shorter prison sentences. The legislation comes after the central bank finally showed signs of support for crypto payments in recent months. Our Freeman Law Cryptocurrency Law Resource page provides a summary of the legal status of cryptocurrency for each country in the world with legal or regulatory requirements for cryptocurrency.
The following globe provides links to country-specific summaries: It`s unclear what the future holds for cryptocurrency in Russia, but for now, the new law goes into effect on July 25. Under the Financial Crimes Enforcement Network (FinCEN), crypto miners are considered money transmitters, so they may be subject to the laws governing this activity. In Israel, for example, crypto mining is treated as a business and is subject to corporate income tax. Regulatory uncertainty remains in India and elsewhere, although Canada and the United States are relatively supportive of cryptocurrency mining. In May, Russian Industry and Trade Minister Denis Manturov said that sooner or later, the country would legalize crypto payments, Reuters reported. [2] Kevin Helms, Putin signs a law giving legal status to cryptocurrency in Russia| Bitcoin News. Regulation (August 2, 2020). Bitcoin News.
news.bitcoin.com/putin-signs-law-cryptocurrency-legal-russia/ Do you have any questions about cryptocurrency, digital currencies or blockchain technology? Freeman Law can help you with digital currencies, tax planning, and tax compliance. Contact us now to schedule a consultation or call (214) 984-3410 to discuss your concerns about cryptocurrency and blockchain technology. In 2017, as part of a joint anti-phishing project of the Bank of Russia and the Yandex search engine, a special tick (a green circle with a tick and the text field “Реестр ЦБ РФ” (Register of the Bank of Russia) appeared in the search results, informing the consumer that the site actually belongs to a legally registered company, which is licensed by the Bank of Russia. [23] [24] The representations of the cryptocurrencies Bitcoin, Ethereum, DogeCoin, Ripple, Litecoin are placed on the motherboard of the PC in this figure dated June 29, 2021. REUTERS/Dado Ruvic/Illustration Oliver Knight is a journalist at CoinDesk between London and Lisbon. He doesn`t own crypto. The Bank of Russia and the country`s Ministry of Finance have reportedly reached an agreement allowing cross-border settlements in cryptocurrencies. The catch is that the use case to legitimize only has to do with foreign payments, while the domestic crypto is still not made for prime time. One can of course see the obvious reason for this logic, as Russia is partially sanctioned by different countries and payment networks, which limits access to cross-border payment alternatives.
We expect domestic crypto payments to arrive as well, but Russia would first like to build its own infrastructure, similar to efforts to create the Mir credit card. “We think we need a local crypto infrastructure,” Chebeskov said. “Above all, to protect the interests of citizens. We assume that this article on Cointelegraph does not surprise any reader, especially since we just commented on a previous article on the same thing a few days ago. In this case, the Central Bank of Russia is now saying that crypto legalization is inevitable. We are not deep into the Russian legal system, but one could assume that legislation in one form or another is needed first, but it could be that BoR has the power to declare crypto legal under the Russian system. However, outside of jurisdictions that have explicitly banned cryptocurrency-related activities, very few countries prohibit cryptocurrency mining.