The Russian government is set to implement a ban on cryptocurrencies as early as September 1, according to top lawmakers in the country. The Chairman of the State Duma Committee on the Financial Market, Anatoly Aksakov, revealed that the new bill will prohibit the organization of cryptocurrency circulation, with exceptions for digital financial assets issued in Russian jurisdictions.
The bill is expected to receive backing from the Central Bank and government ministries, despite initial disagreements on the extent of the ban. While the Central Bank advocated for a complete ban similar to China’s approach, other ministries sought a more regulated stance on cryptocurrency. The compromise bill aims to cater to both sides of the debate.
Under the proposed ban, only miners, mining pools, and test projects supervised by the Central Bank will be exempted from the restrictions. This move is seen as an effort to bring firms engaging in international trade deals using crypto under the bank’s regulatory framework. Governor Elvira Nabiullina has emphasized the importance of keeping cryptocurrencies out of the Russian economy officially.
The bill could potentially lead to Russian banks refusing crypto exchange-related transactions, posing a challenge for the millions of crypto users in the country. Deputy Chairman of the State Duma Committee on Information Policy, Anton Gorelkin, clarified that while the bill aims to prohibit the organization of crypto circulation, it does not ban the circulation itself. This distinction could affect how individuals and businesses interact with cryptocurrencies in Russia.
Gorelkin suggested that the ban on organizing crypto circulation is a protectionist measure aimed at safeguarding Russian businesses from Western sanctions. He acknowledged that future revisions to the ban may be necessary to address emerging challenges in the crypto landscape. The experimental legal regime (EPR) established by the Central Bank will oversee the sale of industrial crypto miners’ coins to overseas buyers, indicating a move towards tighter regulations in the sector.
Rosfinmonitoring, the top Russian anti-money laundering regulator, has been actively monitoring the activities of domestic crypto users. This heightened scrutiny is part of the government’s efforts to combat illicit financial activities facilitated by cryptocurrencies. By tightening control over the crypto sector, Russian authorities aim to mitigate potential risks associated with unregulated digital assets.
The impending crypto ban in Russia reflects the government’s evolving approach to digital assets and their impact on the financial ecosystem. While the ban may disrupt the current crypto landscape in the country, it also signifies a broader regulatory shift towards greater oversight and control. As the crypto industry continues to evolve globally, policymakers and stakeholders will need to navigate these challenges to ensure a balanced and secure environment for all participants.
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