Russia to Enforce Ban on Crypto Assets Starting September 1
Starting September 1, Russia will implement a strict ban on the general circulation of crypto assets, including Bitcoin. However, digital financial assets issued within Russian jurisdiction will still be permitted. This initiative, led by Anatoly Aksakov, Chairman of the State Duma Committee on the Financial Market, is part of a broader governmental effort to regulate the crypto ecosystem in light of increasing geopolitical tensions.
Anatoly Aksakov has emphasized that the upcoming legislation aims at limiting non-Russian crypto operations to maintain the dominance of the Russian ruble. According to Aksakov, digital financial assets issued in Russian jurisdiction and digital rubles will be the only permitted forms of crypto. Aksakov explained that the necessity for this ban stems from the fact that cryptocurrencies are seen as a quasi-currency that can substitute the ruble within the country. However, the Russian government believes that only the ruble can effectively serve as the official monetary unit, prompting the decision for the ban.
- The bill will make exceptions for:
- Crypto miners
- Central Bank-sponsored test projects within a special legal framework
These exceptions are crucial as crypto mining significantly contributes to Russia’s tax revenues, generating over $2.59 billion for foreign trade settlements.
Russian policymakers are engaging in a lively debate regarding the proposed crypto ban. Artem Kiryanov, Deputy Chairman of the State Duma Committee on Economic Policy, emphasized the importance of clear and precise regulations regarding cryptocurrencies. In contrast, Russia’s Finance Minister, Anton Siluanov, has advocated for a more moderate approach. Siluanov believes in regulating cryptocurrencies instead of imposing a complete ban, allowing for their use in both domestic and international transactions.
- Key points to note:
- Russia’s Finance Minister, Anton Siluanov, supports moderate regulation of cryptocurrencies
- Central Bank and government officials are engaging in discussions to find common ground on cryptocurrency regulations
- Elvira Nabiullina, Head of the Bank of Russia, endorses the experimental use of cryptocurrencies in international settlements
Recent discussions hint at a potential shift towards utilizing cryptocurrencies for external payments, showcasing a growing acknowledgment of their role in global finance. Elvira Nabiullina’s support for the experimental use of cryptocurrencies in international settlements further underscores this evolving perspective. In a recent development, reports have emerged detailing how Russian entities, notably utilizing Tether’s USDT, have procured essential military components through cryptocurrencies. For example, a Russian operative based in China effectively bypassed traditional banking channels using USDT to purchase drone components for military operations in Ukraine, circumventing the scrutiny of sanctions-conscious financial institutions.
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