The Russian Ministry of Finance is introducing new regulations that allow Bitcoin investments to be made by consumers.
New regulations for Bitcoin
The Russian Ministry of Finance has submitted a new regulatory draft for cryptocurrencies to the government. In a statement, the Treasury Department said the proposal would allow Russians to invest in digital assets such as Bitcoin. However, purchases using cryptocurrencies can not yet be made.
The Russian government and central bank have been debating cryptocurrencies for some time now. Last month, the Ministry of Finance said it would be necessary to develop cryptocurrency technology. This occurred a week after the country's central bank called for a ban on Bitcoin mining and crypto transactions, leading to a lot of back and forth between regulatory bodies about final legislation.
Not long after, President Vladimir Putin said that Russia had advantages in crypto mining, in part due to the surplus of electricity and well-trained personnel available in the country. Putin called on the Ministry of Finance and the central bank to reach an agreement.
“The use of digital currencies as a means of payment in the Russian Federation remains prohibited. Under the proposed regulation, digital currencies are only considered as a tool for investment,” the statement said.
It added that exchanges must meet certain criteria to be licensed. He further emphasized the importance of KYC checks at exchanges and banks.
Crypto in Russia
Citizens who want to invest in crypto must pass an exam that tests their knowledge about investing, according to the statement. Those who succeed are allowed to invest 600,000 Russian rubles per year in crypto (about £5.590). Those who do not will be limited to only 50,000 rubles.
The crypto world is already very big in Russia. Specifically, Bitcoin mining, the process of verifying transactions on the blockchain and minting new coins or tokens using powerful computers. Miners in Russia currently provide more than 10% of the computing power used on the Bitcoin network.
Today's statement did not provide any details on how the Bitcoin mining industry in Russia would be regulated. The statement said the definition of digital mining as an activity aimed at acquiring cryptocurrencies is entrenched.
Binance joins the union of beacon in Russia
Last week, Binance announced its entry into the Banking Association of Russia on. The aim was to facilitate dialogue with local authorities, lawmakers and experts in the cryptocurrency industry.
The association was founded in 1990 and includes more than 300 banks and financial institutions in Russia. They cover almost 90% of the country's banking infrastructure.
The board of the association has approved Binance membership. This will create a dedicated expert center for digital financial assets and digital currencies. The mission of the center is to prepare professional assessments on the circulation of digital assets in Russia and to provide the association and its representatives with expert data on the subject. It also reports on the international experience in dealing with crypto assets.
High levels confidence
Olga Goncharova, the director of Binance in Russia, will be in charge. This was approved by the council of the presidium of the association. Goncharova joined the crypto exchange in January to boost compliance efforts in Russia. Before joining Binance, she worked as a department director at the Bank of Russia.
Introducing Goncharova, Association president Georgy Luntovsky noted that she will be responsible for properly overseeing the circulation of digital currencies in Russia. He noted the following:
In our opinion, she is a good candidate to lead the platform. The expert community can discuss approaches to the regulation and development of digital financial assets
Gleb Kostarev, director at Binance's Eastern European division, expressed confidence that Binance's expertise in the crypto market will be positively received by the Russian banking community.
We are on the cusp of a global transformation in cryptocurrency regulation. Binance, as the largest cryptocurrency ecosystem in the world, has a solid track record of partnering with regulators.
Binance is known for its close association with some Russian organizations backed by the state. The same goes for local blockchain proponents.