Russia to ban the issuance and circulation of cryptocurrencies
Wed, 18 Mar 2020, 00:47 am UTC
Russia is planning to ban crypto issuance and circulation.
The original bill “On Digital Financial Assets” allows cryptocurrency trading in Russia. However, Alexey Guznov, head of the legal department at Russia’s central bank revealed in an interview with local news agency Interfax on March 16 that the proposed amendment will prohibit nearly everything about crypto, Cointelegraph reported.
“In terms of the functioning of the financial system and consumer protection system, legalization of the issuance and facilitating the circulation of cryptocurrencies is an unjustified risk. As such, the bill explicitly prohibits emission and organization of cryptocurrency circulation, introducing legal liability for violating these rules,” Guznov said.
Although the crypto bill would ban Russian financial institutions from issuing digital assets, Guznov confessed that there are instances that are difficult to control on their part.
“If a person who owns, for example, Bitcoins, completes a transaction in a jurisdiction that does not prohibit this, we are unlikely to be able to regulate that,” he added.
Russia’s cryptocurrency regulation was first introduced in 2018. President Vladimir Putin ordered the adoption of the bill twice, but the legislation was still not final. In 2019, the Bank of Russia told state-operated news agency RIA that cryptocurrencies carry “significant risks” including the potential for money laundering and terrorism financing activities. It has sharp exchange fluctuations too.
“In our opinion, private cryptocurrencies cannot be equated with fiat money and cannot be legal tender. If it is decided to ban cryptocurrencies as a means of payment at the legislative level, we consider it appropriate to support this position,” the central bank said.
In November, Russia’s Ministry of Internal Affair was considering creating legislation that would allow authorities to force criminals to give up their stolen digital assets. The agency mandated that the proposal be completed by December 2021.
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