The Central Bank of Russia has begun to seek ways of integrating cryptocurrencies and blockchain into the economy. This comes in the midst of increasing sanctions from Western countries. They have imposed lots of economic sanctions on Russia following the start of the war with Ukraine.
The central bank published a consultation study on Monday called Digital Assets in Russia. The study considered if it would be appropriate for the country to let crypto from friendly countries run within the economy.
Likewise, the study included some recommendations that would reform the country’s taxation and accounting. It would also help to protect small businesses and investors while it regulates digital assets. It also gave recommendations on digital property rights linked to smart contracts.
The Russian central bank says it strongly supports developing digital technologies. The proviso is that they don’t expose users to danger with regard to cybersecurity and finances.
The central bank stated further that the regulations applicable to the issuance and circulation of fiat money should apply to crypto assets. This is necessary despite the fact that the technology is relatively new.
Equally, there has been news that new legislation is looking for ways to permit the minting of cryptocurrency in Russia. The proposed legislation states that minted cryptocurrencies should only be spent outside Russia. But a follow-up bill permits their usage under experimentation.
The Requirement for Better Regulations
The head of the State Duma’s Financial Committee, Anatoly Aksakov, explained the reason for the latest proposal. According to him, it is majorly to permit the minting of every cryptocurrency.
The central bank says it believes that short-term laws should be focused on protecting investors. It should also clarify the requirements of issuing digital assets by ensuring issuers are accredited. Importantly, the legislation should make sure issuers state all necessary information to investors.
There are already set foundations for developing digital assets. The central bank, however, says it is necessary to have better regulations. The bank says it is needed for further development in the future.
There already exists a legal structure on the ground for smart contract regulation, according to the central bank. Nevertheless, smart contracts developed in Russia might have to go through independent auditing before it gets used.
The bank’s statement says Russia already has the required structure for issuing and circulating digital assets. But it is still in its early stage and a lot inferior to traditional finance. Its future development, therefore, needs better regulation.