After many years of restrictions, Russia is deregulating cryptocurrency and joining the global crypto industry
Russian President Vladimir Putin recently proposed a new law to allow the trading of cryptocurrency. He thinks it will go into effect in January 2021.
The policy still limits the capability to pay for goods and services with cryptocurrency in Russia — but the overall regulatory structure would be far more open.
As approved by Parliament, digital currency is now defined by the Russian Government as:
“…an aggregate of electronic data capable of being accepted as the payment means, not being the monetary unit of the Russian Federation or a foreign state, and as investments”.
Although crypto cannot be used to purchase goods and services, it can still be pledged, bought and/or sold by investors.
Russian news agency TASS defined cryptos as:
“Digital financial assets (DFA),… are digital rights comprising money claims, ability to exercise rights under negotiable securities, rights to participate in equity of a non-public stock company and right to claim transfer of negotiable securities set in a resolution on the DFA issue.”
Additionally, the law bans any advertisement regarding a crypto payment platform in Russia.
Tokens can be acquired only from financial institutions that issued them under the regulations directed by Russian law. Obtaining crypto outside of this process is still legal, but must be purchased on foreign platforms.
Fast to react
Shortly after the new law was passed, Sberbank had already considered plans for a stablecoin that would be directly linked to Russian rubles.
Sergey Popov, an executive at Sberbank stated:
“We probably may issue a stablecoin on the basis of the law that has been adopted recently. As we can peg this stablecoin to the ruble, this token could become a basis or an instrument for settlements involving other digital financial assets.”
Slow to adopt
Considering how far other nations have already gone, Russian attempts to adopt crypto may not be enough to foster widespread use in the nation.
The founder of KickEX.com, Anti Danilevski, commented on the state of crypto in Russia:
“We are already lagging behind in the economy and only now are we taking tiny steps towards the adoption of crypto. We are behind in the crypto race in this sense. The train has already left.”
China has implemented blockchain technology across various federal agencies and businesses, and is currently developing its CBDC in the form of the digital yuan.