Russia’s Finance Ministry submits draft legislation to govern cryptocurrencies

The Russian central bank proposed an outright ban on cryptocurrencies in January, but the finance ministry has been pushing for regulation to help attract investment.

The Russian finance ministry announced on Monday that it had submitted draft legislation on governing cryptocurrencies, which included client identification and an investment cap.

Russia is one of the world’s leading crypto-mining countries, and authorities have long criticized cryptocurrencies, fearing they will be used for illegal activities, and have called for regulation.

“The proposed changes aim to create a legal market for digital currencies by establishing rules for their circulation and the circle of participants,” the ministry stated in a statement.
Cryptocurrencies would be permitted only as an investment instrument under the bill. Foreign cryptocurrency exchanges will also be required to obtain a licence in Russia, among other proposals.

“Operations involving the purchase or sale of cryptocurrency will be possible only if the client is identified,” the finance ministry added, putting an end to anonymity, a key principle of the crypto world.

The draught legislation also calls for the implementation of literacy tests for those wishing to invest in digital currencies. Following the “successful” completion of tests, Russians will be able to invest in digital currencies worth up to 600,000 rubles ($7,700, 6,800 euros) per year, according to the finance ministry. Without these tests, the limit would be 50,000 rubles.

Cryptocurrencies were granted legal status in Russia in 2020, but their use in payments was never permitted.

Subscribe to our newsletter
Subscribe to our newsletter
Sign up here to get the latest news delivered directly to your inbox.
You can unsubscribe at any time