Russia is on the verge of significantly altering its approach to cryptocurrency regulation. The State Duma’s Financial Markets Committee has endorsed an updated version of the “On Digital Currency and Digital Rights” bill, paving the way for its progression to a second reading. Upon enactment, this legislation would authorize the exchange of specific cryptocurrencies and permit the use of crypto assets for payments in designated contexts.
What Could the New Law Mean?
The revamped bill opens doors for investors to leverage digital assets in acquiring securities exempt from public offerings. It also creates a legal groundwork for exchanging various cryptocurrencies and utilizing them to settle transfer fees on blockchain networks.
The Russian Federation will permit the use of digital currencies and digital rights as means of payment for securities, other digital currencies, or digital rights.
Despite these potential expansions, the Russian ruble continues to hold its status as the sole legal tender, with its digital version upholding this official role. Previous amendments allowed exceptions for rewards through crypto mining and sanctioned international trade, but the recent adjustments extend these exceptions further.
Are There Criteria for Listed Cryptos?
Yes, the criteria for listing cryptocurrencies on Russian markets remain stringent. Digital assets must have shown an average market value of over 5 trillion rubles in the past two years, a daily trading volume surpassing 1 trillion rubles, and five years of trading on a recognized foreign exchange.
Currently, only major cryptocurrencies like Bitcoin and Ethereum fit these parameters, but the Board of Directors of the Bank of Russia can approve those that don’t meet all criteria.
The definition of digital currency under this bill might disqualify prominent stablecoins such as Tether’s USDT and Circle’s USDC, as they require an issuer, which the law does not support.
- Professional investors to gain broader access to cryptocurrencies without needing central bank approval.
- Retail investors remain limited in their crypto asset acquisition opportunities.
- Potential inclusion of a licensing structure for exchanges and other crypto service providers.
Initially, the regulation was scheduled to be effective from July 1, but subsequent amendments have delayed its start to September 1. The legislation still requires the Federation Council’s approval and the signature of Russian President Vladimir Putin to be finalized as law.
