According to a post from the Russian news site Kommersant, Russia’s Finance Ministry has finished a law that would cover cryptocurrency payments in the nation. The legislation may finally offer residents and cryptocurrency investors in Russia certainty about crypto assets and mining, something that has been lacking in recent years. The study, titled “On Digital Current,” examines unknown areas of Russian legislation for this budding asset category.
Different Aspects Of The Bill
Among these considerations are the categorization of crypto, the legal structure for its creation and distribution in Russia, certificates, trading, and other related issues and concerns. As reported by Kommersant, Russian businesses would have to be given a license to trade cryptos and go through a rigorous identity procedure to trade cryptos.
According to the legislation, crypto may be approved as a payment method and an investment vehicle. However, for crypto platforms to provide crypto services in the country, they have to maintain a certain level of capital. This sum is fixed at about $40k for exchanges and more than $100k for virtual trading systems.
These organizations will be required to endorse a “stringent” procedure to remain compliant with regulations, including the formation of annual reports, separate units, internal audits and control, and Anti-Money Laundering registration.
This implies that an exchange that wishes to provide its services to the country must finish this procedure and get a license from an “approved body” established by the government. Furthermore, exchanges will be required to maintain rigorous control over the data they collect from their consumers.
Why Russia’s Cryptocurrency Law Could Be A Wasted Effort
Small businesses and cryptocurrency investors may find the requirements above burdensome as the information gathered from clients must be maintained and updated regularly. As per Kommersant’s report, only Russian firms are eligible to submit applications to provide their services. Hence, for crypto companies to get the license to do business in Russia, they must establish a legal organization in the country.
Meanwhile, Russian citizens are permitted to trade crypto on foreign stock markets. The Russian regulators feel their KYC standards are adequate to allow them to submit their information to local authorities.
This legislation appears to be a positive step forward for cryptocurrency users in the nation. Russian entities, on the other hand, have expressed alarm over them. Some people argue that the paper fails to address critical issues about fraud and other illegal activities.
Individuals can circumvent legal restrictions completely and instead resort to foreign markets. Because Russia intends to establish a national database for the mining industry, miners will be required to register the same way traders do.