Russia Turns Bullish On Bitcoin As A Draft Bill Suggests Crypto Adoption As Legal Tender
On Friday, Russia’s finance ministry filed a finished bill regulating cryptocurrencies in the country.
According to Kommersant, the measure titled “On Digital Currency” establishes a precise legal framework for the circulation of cryptocurrencies and, for the first time, “details mining,” creating new chances for Bitcoin miners who are now operating in a legislative grey area.
Apart from establishing the legal framework for cryptocurrency circulation and issuance, the draught law also establishes certification, identity, and accounting criteria for firms wishing to establish digital asset enterprises in Russia.
Notably, the proposed legislation states that digital currency may be accepted “as a method of payment that is not the Russian Federation’s monetary unit.” Additionally, the law acknowledges bitcoins as legitimate investment instruments.
The legislation establishes rules for enterprises that want to engage in digital asset trading. For example, an exchange operator must have a minimum operating capital of 30 million rubles ($36 million) in order to get a business license. On the other hand, an operator of a digital trading platform seeking to participate in the business of virtual currency circulation must have a minimum of 100 million rubles ($120 million).
The law, however, imposes rigorous obligations on the two operators, including the submission of annual reports, the establishment of management bodies, internal audits, and control, and the establishment of a distinct structural unit. Numerous crypto enthusiasts have criticized several of the proposed laws as being inconvenient and too damaging to operators of digital assets.
According to Blockchain attorney Mikhail Uspensky, regulations such as the obligation to maintain a record of digital currency owners and the necessary certification of electronic wallets are “highly exaggerated” and may deter digital asset providers from establishing their businesses.
Friday’s bill comes as the administration has proposed draught legislation to the state duma that would impose a tax on digital asset transactions. If the document is implemented, Russian organizations that possess digital assets would pay a tax of 13%, while international corporations will pay a tax of 15%.
Nonetheless, despite Russia’s central bank’s severe position on cryptocurrencies, the tides seem to be turning under Putin’s government, particularly in light of Russia’s continued sanctions for invading Ukraine. Accelerating crypto regulation is therefore seen as a necessary move for a government that controls the third-largest bitcoin mining hash rate in the world.