Cryptocurrency regulations are quite tricky and up until now, only a few countries can boast of finding the right mix of existing new laws to regulate digital assets fairly.
Russia is definitely not among the few of those countries as it always had a passive stance towards privately issued or decentralized cryptocurrencies.
After months of rumors and speculation over Russia’s regulatory policy towards crypto assets, the government has finally submitted a new draft law on its official website for public comment on Monday. This new set of regulations, along with additional documents uploaded on the website, suggested that the government does not approve of cryptocurrencies as a legal asset.
Breaking these newly formed regulations also come with legal penalties. The new set of rules, if implemented, would prohibit the circulation of any privately issued cryptocurrencies as well as mining them. The advertisement related to these crypto-assets would also invite hefty penalties for the advertisers.
However, these regulations do not mean that crypto is illegal to own in Russia, as the central bank has neither formulated any laws around it nor they have classified crypto as security under Russian laws.
One of the members of the State Duma, Anatoly Aksakov, confirmed that these drafted laws would not go into effect until next summer. Last week, Aksakov also cleared any doubts on crypto ownership in Russia, saying people can still buy and own crypto as long as they declare it while filing their taxes. This would allow them to get legal protection as the state would consider it as property.
The New Digital Asset Law Could Force Crypto Service Providers To Close Down or Relocate
Crypto owners won’t be as impacted by these laws as the crypto service providers in Russia. Anti Danilevski, CEO of the new KickEX cryptocurrency exchange commented on the recently introduced draft laws and said:
“We were initially regulated in the European Union, not in Russia because we anticipated this. It’s a pity that cool technology startups are forced to leave the country and cannot operate in their homeland. We will transfer our team to the EU now. It’s painful for me to see that in the field of cryptocurrencies and digitalization, my country is moving backwards while the whole world is moving forward.”
If these laws are implemented without any amendments, then it would many many crypto service providers in the country especially crypto exchanges would either have to shut their operations or relocate.