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Russia Rejects Crypto Ban, Opts for Regulatory Roadmap

Many of Russia's heavy hands reportedly favor crypto regulations over a ban.

Russia Rejects Crypto Ban, Opts for Regulatory Roadmap
Shutterstock cover by TTstudio

Key Takeaways

  • A roadmap that outlines restrictions on digital assets rather than a ban has gained support from Russian authorities.
  • This roadmap opposes the ban proposed last week by the Bank of Russia, which serves as the country's central bank.
  • The Bank of Russia still supports a ban on crypto.

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Agencies in Russia are in favor of a cryptocurrency regulation roadmap rather than a blanket ban as was feared last week.

Russia Favors Regulation

Authorities in Russia have put forward a plan to restrict and regulate the trading and mining of cryptocurrencies without imposing an outright ban on the industry, according to Reuters.

The roadmap sets out various deadlines. By May, Russia wants to have in place a compliance platform for peer-to-peer transactions. By November, it aims to be using anti-money laundering guidelines recommended by the Financial Action Task Force. And by the end of 2022, it should have registration rules for crypto exchanges in place.

The document also suggests punishments for businesses operating in the country that fail to disclose their crypto transactions. It may even go as far as to mandate that Russian citizens report all crypto asset holdings.

The roadmap has reportedly been fully embraced by the agencies involved in its design and has been signed by Deputy Prime Minister Dmitry Chernyshenko.

President Vladimir Putin is likely to support the proposed roadmap. Last week, Putin opposed a ban on cryptocurrencies put forward by the Bank of Russia, stating that the central bank “should not stand in our way of technological progress.” He also suggested that Russia could maintain a competitive advantage in crypto mining due to its power surplus, assuming the industry is regulated and taxed.

Central Bank Still Advocates for a Ban

Russia’s regulation roadmap appears more favorable to the crypto industry than the previous overarching ban proposed by the Bank of Russia last week.

At that time, Russia’s central bank called for a ban on cryptocurrency transactions, citing concerns over financial stability. It has also called for a ban on crypto mining due to the environmental impact of the energy-intensive process. The bank additionally pushed for financial institutions to be forbidden from investing in crypto assets. 

The Bank of Russia expressed familiarity with the roadmap revealed today. However, it urged for stronger restrictions, stating that “it is necessary to prepare a federal law, establishing a ban… [and] also to determine liability for violating this ban.”

The bank’s head of financial stability, Elizaveta Danilova, added that the bank does not aim to ban ownership of cryptocurrencies.

The Bank of Russia cannot implement the recommendations that it has proposed on its own, meaning that it must continue to negotiate with other Russian agencies in the coming months.

Disclosure: At the time of writing, the author of this piece owned BTC, ETH, and several other cryptocurrencies. 

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