Putin Prohibits The Use of Cryptocurrency in Russia

Russian President Vladimir Putin has approved a bill that forbids the use of digital financial assets (DFAs) as a form of payment in the nation, according to the Russian news website RBC. The processing of transactions that support the use of digital financial assets as a form of payment is likewise forbidden by this rule for exchange operators.

Despite the fact that “monetary surrogates” are already forbidden in Russia,

the new law is the first to explicitly forbid the use of digital assets in payments.

A direct ban on using DFAs as a form of payment in Russia has been implemented by the country’s leader in compliance with recently established legislation. Rights to practical digital resources are also included in the restriction (UDRs).

A few months after Russia created laws recognizing cryptocurrencies as a type of currency, but with “strict requirements for all players,” the decision was taken. A little more than a month before to that, Russia’s central bank had advocated banning miners and several crypto-related activities out of concern that they would endanger the nation’s financial system.

Despite the fact that DFAs and UDRs are covered by the new legislation, Moscow has not yet imposed any significant restrictions on cryptocurrencies. However, DFAs and UDRs are subject to the new regulation. Officials from the country are expected to analyze proposed legislation titled “On Digital Currency,” which aims to solve the current regulatory gaps.

The newly passed legislation was first proposed by Anatoly Aksakov, the State Duma’s Chairman of the Committee on Financial Markets. One month ago, he delivered it to the lower house of the Russian parliament. The new legislation will go into effect within the next ten days, the article said.

Advertisement

The law forbids the use of digital financial assets to pay for “transferred items, performed works, or supplied services,” but it leaves open the use of DFAs to fund other kinds of transactions. Earlier this month, the Russian financial regulator declared that it was inclined to accept the use of digital assets to settle accounts with foreign partners.

The concept of using bitcoin in global settlements has received broad support in light of the severe sanctions put in place against Russia by the west in reaction to its invasion of Ukraine. On the other hand, the vast majority of Russian government bodies still adhere to the belief that only the ruble should be accepted as payment for transactions that are regarded as legal tender.

More legislation governing digital currencies is being drafted right now.

Following the implementation of the ban on DFA payments, Russian lawmakers are currently drafting new legislation that specifically targets digital assets. The next bill titled “On Digital Currency” is expected to put comprehensive regulations on the country’s market for digital assets, while the bill titled “On Mining in the Russian Federation” is expected to impose additional controls on the mining block rewards.

In order to integrate “the mechanism for the circulation of digital currencies into the financial system and ensure control over cash flows in the circuit of credit institutions,” Russia’s financial monitoring agency created a cryptocurrency monitoring program a year ago.

The government agency announced last week that it plans to expand the capacity of its crypto monitoring service amid the continued “cryptomania.” Cryptomania and the addiction that is connected to the gambling business, another heavily controlled sector in Russia, were compared by Aksakov.

Read More Blockchain News Here

Advertisement