Another big power has claimed it will not follow Beijing in a nationwide crypto crackdown – Moscow being the latest to distance itself from such a move, days after the United States Securities and Exchange Commission seemed to exclude the notion. But there could be a key caveat to Russia’s stance on crypto: Exchanges may be banned overseas.
Interfax cited Alexey Moiseev, Russian Deputy Minister of Finance, said:
“At the moment I can only say that [crypto] Payments [are not permitted] on Russian territory. At the same time, citizens can buy [coins] and use wallets outside of Russia. It will remain the case, I think. There are currently no plans to change anything.
So far, Russia’s only crypto-specific law (which was enacted on January 1 of this year) prohibits crypto payments, but provides little more than a “glossary of terms,” as reported last year. .. Moiseev agreed that key terms such as cryptoassets, digital assets and blockchain technology were still not defined by the civil code – a box the government and lawmakers have been putting in place for months, even years.
Moiseev, however, suggested that Moscow is happy for citizens to trade and own cryptocurrencies – provided the coins stay out of the country. In response to questions from students following a conference at Moscow State Institute of International Relations, the Deputy Minister said:
“Of course, a Russian citizen can have a wallet outside of Russia, but he will be subject to bans if he operates in the country – I think – for the foreseeable future.”
It wasn’t clear who “they” were supposed to be referring to in this case, but the most likely answer is crypto exchanges.
The majority of the largest Russian crypto exchanges have moved their headquarters overseas in recent years, which could allow them to continue operating in the event of a domestic failure of Russian-based trading platforms.
Moiseev claimed that “financial sovereignty” would be compromised if “a ban on operations with cryptocurrencies on Russian territory” was not enacted.
Dmitry Machikhin, CEO of the crypto accounting department Bitnalog, Recount Cryptonews.com that the deputy minister’s statement “does not tell us whether Russian crypto exchanges should go or not”, as currently no trading platform is “legally constituted in Russia, due to a lack of legislation”.
“In the near future, some exchanges [nominally] become operators of digital assets under the terms of the legislation that entered into force in January 2021.
Machikhin also spoke about the direction of crypto regulation in Russia, saying it could be decisive. The CEO concluded:
“The future of crypto regulation in Russia lies in taxes and anti-money laundering protocols. If the government finds a way to squeeze new revenue streams from crypto and adopts FATF measures (if ratified) the industry will live happily ever after. Otherwise it could be done for.
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(Updated at 2:40 PM UTC with comments from Dmitry Machikhin.)