Russia Could Be the Next to Legalize Crypto for Payments
According to local Russian news source Kommersant, the Russian Ministry of Finance has completed a bill on regulating crypto payments and mining in the country. The local news channel got the document, later authenticated by two independent sources. The Ministry of Finance, however, declined to issue any statement promptly.
What Does the Bill Propose?
The document defines the language used in virtual cash and the legal structure that governs its circulation and issue. It also includes various new identity, accounting, and accreditation standards. As the experts consulted point out, these regulations will have little impact on bitcoin operations outside of the Russian information infrastructure.
The bill finalized by the Ministry of Finance to regulate the usage of digital currencies in Russia comprises a detailed regulatory framework. For the first time, it specifically addresses mining. It’s expected to provide citizens with the clarity required for digital assets mining and circulation.
The concept of professional and non-professional buyers, as well as the responsibility to test, are introduced. The paper, according to specialists, opens up new chances for miners who want to break out of the gray zone. On the other hand, it has the potential to attract investors to the black market, and the requirements for trading operators appear to be exorbitant.
The law also addresses the regulatory requirements for crypto companies. To sell their services in Russia, crypto firms will have to meet a minimum capital requirement. For exchange operators, this sum is roughly $40,000, while for digital trading platforms, it is over $100,000.
Additionally, these businesses will need to adopt a “stringent” process that includes creating independent units, annual reports, internal control, audits, and comprehensive registrations on specialized entities for Anti-Money Laundering (AML), among other things, to confirm their compliance with Russian rules.
Finally, the draft bill addresses in full for the first time the mining process that legal firms and individual entrepreneurs will be able to carry out after being registered in the appropriate register. The authorities will determine taxation on a case-by-case basis.
Cryptocurrencies can be Used as a Form of Payment
The proposed law, amid sanctions outlines that digital money can be accepted as a means of payment that is not the Russian Federation’s financial unit and investment without requiring an obligated party to be involved.
According to Sergei Mendeleev, CEO of InDeFi Smart Bank, the definition of the latter component poses questions. For example, the Tether website indicates that it does not have an obligated person. Still, Russian law enforcement believes it is Tether LTD.
The Bill Could be Fruitless
The strict and cumbersome nature of the draft could be inconvenient for small to medium enterprises and the confidentiality of investors. The government will still allow international exchanges in the market.
This proposal appears to be a positive step forward for crypto users in the country. Russian entities, on the other hand, are concerned. Some critics say the crypto regulations document fails to address important issues. People could thus skirt the law entirely by using foreign transactions or the illicit market.
