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Friday, June 14, 2024

Bill to ban digital assets as payment introduced in Russian parliament



In recent months, Russian legislators have been preparing measures to fully institutionalize crypto as a properly taxable investment asset and a possible tool for foreign trade in Russia. Now, they want to make clear that the upcoming regulatory turn won’t include any windows for adopting digital financial products as a payment method.

On Tuesday, June 7, Anatoliy Aksakov, the head of the Financial Markets Committee of the Russian parliament’s lower chamber — the State Duma — introduced a bill that would prohibit the use of “digital financial actives” (DFA) to pay for any kind of goods or services. As the cover note specified:

“The ruble is the official monetary unit (currency) of the Russian Federation. The aforementioned article sets a prohibition against the introduction of other monetary units or monetary surrogates on the territory of the Russian Federation.”

The bill refers to already existing legislation, which doesn’t explicitly prohibit using DFAs as a payment method, although de-facto such operations still aren’t considered legal in the country. The new document would make this ban official and oblige DFA exchange managers to withhold any deals implicating the usage of crypto as a monetary surrogate.

Related: Russia to include crypto into its tax code: Here is what the rules might look like

The bill also introduced the concept of an “electronic platform,” which is loosely defined as a financial platform, investment platform or information system in which digital financial assets are issued. Electronic platforms would be recognized as the subjects of the national payment system and obliged to submit to the central bank’s registry. Every major operation with DFAs — their emission, circulation, exchange and trade — would get its own registry.

The existing law on Digital Financial Actives came into force in 2021. In May 2022 the tax amendments on DFAs passed the first reading in the State Duma. In a separate development, two other important bills are continuing their journey through the legislative process — a bill “On digital currency” would define the regulatory framework for crypto in general, while a bill “On mining in Russian Federation” should set the guidelines for miners.