Crypto Remains Unregulated in Russia — Lots of Talk but No Action

At the end of November, news surfaced that Russian cryptocurrency users, who have been operating in a regulatory gray zone, could soon be at risk as the nation’s financial authorities reportedly join forces to outlaw the use of digital assets as a payment instrument.

Shortly after, the country’s interior ministry confirmed rumors that it was on track to developing a legal framework for confiscating digital assets, which could come into effect as soon as 2021. Finally, the head of Russia’s main financial intelligence agency, the Federal Financial Monitoring Service, has also spoken unfavorably before parliament about the prospects of legalizing crypto use.

Do these moves signify a wider government clampdown on digital finance, and does the Russian crypto community perceive them as a threat?

Not legal tender

Local publication Izvestia, citing an anonymous source, reported on Nov. 29 that the Central Bank of Russia and the Federal Financial Monitoring Service were drafting legislation to ban the use of crypto assets for the purchase of goods and services. No details were disclosed with regard to potential enforcement mechanisms or punishment for violators.

The central bank’s response to Cointelegraph’s inquiry largely echoes its sentiments published by Izvestia, detailing its stance on cryptos and willingness to support initiatives seeking to ban their use:

“The ruble is the only legal tender in Russia. We remain convinced that cryptocurrencies pose significant risks, including laundering of illegally gained funds, financing of terrorism, and extreme volatility of exchange rates. We believe that private cryptocurrencies cannot be equated to fiat money nor considered legal tender. Should there emerge a legislative initiative to ban cryptocurrencies as means of payment, we deem it appropriate to support it.”

The Federal Financial Monitoring Service and the Ministry of Finance have not yet responded to Cointelegraph’s request for comment.

As in many…

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