Russian bank pioneers blockchain-based bank guarantee in Chinese currencyTL;DR Breakdown
- The Russian government and the central bank have agreed to legally recognize crypto assets, like Bitcoin and Ethereum, as currency.
- The new decision will impact the dealing of digital assets, as a central authority will overlook the process.
The growing demand for digital assets has resulted in legislation from different governments. Some countries have formulated laws to regulate digital assets, while others are still working on them. News from India had come that soon the union would be presenting a bill regarding cryptocurrency in their legislative assembly.
Russia is a new addition to this row as a credible newspaper; Kommersant has announced the finalization of legislation regarding digital assets. According to this newspaper, the authorities negotiated crypto because of growing complications in the absence of requisite laws.
The following article covers the complete details of the latest updates from different sources.
Growing acceptance for crypto assets
The growing popularity of crypto amongst customers and the resultant acceptance from the government has had their impacts on Russia as well. There were different speculations about the Russian government’s decision regarding it. Some believed that the Russian government might ban it.
The decision regarding crypto has amazed many because of its acceptance as currency like dollar and other foreign currencies instead of treating it like digital assets. The law will be formulated by 18 February, as per the update from Kommersant that has shared this news.
According to their story, the dissemination of digital currencies will occur through regulators like banks and other financial institutions in a legal manner. The restriction in this draft regarding the dealing of crypto is declaration if the person using it makes a transaction worth more than 600,000 rubles. If they fail to declare them, they will face the consequences of being considered a criminal offense.
If it goes undeclared, the transaction will be considered payment for criminal activities. Other issues like mining and related operations to digital financial assets will be treated with laws other than this crypto law.
The Russian government and central bank reach an agreement
According to Russian government authorities, talks were going on between representatives of the Russian government and the Russian federal bank. The ministry of finance was assigned this duty to formulate a draft regarding the regulation of crypto. There was a suggestion from the Bank of Russia to ban cryptocurrencies, but it was rejected because of possible repercussions.
There is no clear idea about the transition period regarding the report from the finance ministry. The decision will take time as stakeholders will be taken into confidence to decide the possible solution. The suggestions and steps from the central bank suggest that it is skeptical of digital currencies.
The legislation will also include details regarding the taxation of crypto, which will be considered a currency after the bill becomes law. A P2P exchanger or an organizer will keep track of the transactions and investments in the mentioned assets. The control of crypto will be done using a model that is no different from foreign currency. As per an assessment, the ministry believes that the amount of crypto assets is worth 2 trillion rubles.
Final thoughts
The Russian government has decided that it will regulate crypto investments. As per the latest updates from Kommersant, the regulations will be presented in a draft form to the legislative bodies by 18 February. Once the draft is accepted, it will become a law, and the crypto transactions without a declaration will become a criminal offense. Along with that, the minimum amount for declaration has also been mentioned. It will help with the promotion of digital currencies and the prevention of illegal activity using them.
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