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Ministry of Finance has submitted a draft of cryptocurrency regulations in Russia

Despite the fact that the country possesses the world’s third-largest crypto mining activity, the Central Bank regards the transaction as risky.

On Monday, the Russian Finance Ministry presented to the government a proposal of long-awaited cryptocurrency rules, taking a minor step toward clarity for a thriving but mostly uncontrolled business market.

The proposal maintains the present restriction on crypto payments for goods and services, establishes a limit on the number of rubles that may be invested in cryptocurrencies, and specifies what it means to mine cryptocurrency.

In an interview, Finance Minister Anton Siluanov stated that he believes the legislation would be enacted before the end of the year.

In early February, Russia’s cryptocurrency market was valued at more than $200 billion, accounting for around 12% of the worldwide market.
According to the Russian government, $5 billion in cryptocurrency transactions are performed in the nation each year, and the country’s 144 million people holds around $26.5 billion in bitcoin in over 12 million cryptocurrency accounts.

The new proposal follows five years of conflicting messages from the Russian administration.
On January 20, Russia’s Central Bank advocated for a comprehensive ban on cryptocurrencies, equating them to a financial pyramid scheme that “may collapse” and blaming mining for “unproductive energy usage.”

On January 25, Finance Ministry official Ivan Chebeskov openly condemned the prohibition, causing Russian President Vladimir Putin to publicly urge for a compromise.
Putin acknowledged the risks of investing in cryptocurrencies but stated that the Central Bank will not obstruct “technological advancement” and cited Russia’s “competitive advantages” in crypto-mining.

Photo by Astemir Almov

About the author, Deyvid Stoyanov

Deyvid developed his passion for technology, innovation, blockchain and decentralization throughout his bachelor and masters degree studies in Bulgaria and Italy. With several years of experience in the private sector, he is currently part of the FinTech Legal Center Tallinn-based team and remains immersed in the transformation of the financial and banking sector, the adoption of blockchain and cryptographic technologies as well as their interrelationship with state supervisory authorities and the European regulatory structure.

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