Russia Inclined to Legalize Rather Than Ban Cryptocurrency

The Russian government, which is hosting the ongoing debate on the future of decentralized digital money in Russia, is going to produce alternative scenarios for crypto regulation by Feb. 11. The Russian business daily Kommersant broke the news, quoting documents from a meeting held at the White House in Moscow last week.

The fate of cryptocurrencies in the country is likely to be decided by the outcome of a clash between two opposing views. While the Central Bank of Russia proposes a blanket ban on crypto-related activities such as issuance, exchange, and mining, the Ministry of Finance pushes for legalization under strict rules and without recognizing bitcoin as a means of payment.

Most government institutions, including relevant ministries, have supported the approach suggested by the treasury department. If it is adopted, Russians owning digital coins will be able to operate with them as with investment assets under the watchful eye of the government, make transactions through Russian banks and pay taxes.

Bank of Russia elaborated its position on cryptocurrencies in a consultation paper published last month. It says that all transactions with private digital currencies should be conducted outside Russian jurisdiction and without using Russia’s financial infrastructure. On the other hand, the Finance Ministry insists that authorities should differentiate between “white” and “black” crypto market activities. Both agree, however, that cryptocurrencies should not be granted legal tender status.

Last week, RBC reported that the government has drafted a regulatory roadmap, signed by Deputy Prime Minister Dmitry Chernyshenko. According to Kommersant, its concept about the regulation of the crypto market has been outlined in a letter by Finance Minister Anton Siluanov to Prime Minister Mikhail Mishustin. It has been agreed with other departments and regulatory bodies, including the ministries of economy and digital development, Russia’s financial watchdog, Rosfinmonitoring, the Federal Tax Service and the Federal Security Service.

According to Siluanov, Russian citizens have 12 million crypto wallets with coins worth around 2 trillion rubles (almost $26.5 billion). However, knowledgeable sources quoted by Bloomberg have recently revealed that the government is also working with a much higher estimate, according to which Russians own $215 billion in cryptocurrency.


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