Russian Ministry of Finance to Ban Crypto Transactions

Russian Ministry of Finance to Ban Crypto Transactions

The Russian Ministry of Finance has developed a new bill, tied up to an earlier try to ban cryptocurrencies. If the law passes, it will have a significant effect on Russia.

This first bill is the predecessor of a comprehensive law to cover all the details for cryptocurrency regulation. This draft with the name “About Digital Currency” will be likely completed and opened in December this year.

The bill should also change a new law about digital assets signed by Russian President Vladimir Putin at the end of July 2020.

Miners under threat of financial fines and imprisonment

The document describes administrative and criminal responsibility to the people who deal with cryptocurrency transactions. If the changes are accepted and implemented, the person found guilty can be charged a fine of 100.000 Rubel (CHF 1200) and seven years of imprisonment. The fines threatening to business can reach 1 Million Rubel (CHF 12’000).

The changes to restrictions offered by the Ministry of Finance also include three exceptions under which a person can obtain cryptocurrency. They are the heritage, receiving cryptocurrencies through contests or enforcement proceedings, or a case when government officials or prosecution authorities should deal with cryptocurrencies according to their duties.

A way to bypass the problem

Igor Runets, the CEO of BitRiver, one of the largest mining farms in Russia, sees a possibility to bypass this problem in founding a foreign entity to handle miners or mining companies’ finances. The idea is not cheap and is not an option for individual miners who cannot afford high legal expenses.

On November 29 of the previous year, the Central Bank already spoke against bitcoin. It supported that position by the fact that the Russian Rubel should be the only legal currency of the nation.

*Originally published in German at CVJ.ch

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Crypto Valley Journal

The CVJ editorial team consists of crypto experts, active in different areas around the blockchain technology. In cooperation with selected authors, CVJ.CH provides a high-quality resource around the distributed ledger technology. Independent and up-to-date reporting according to journalistic standards as well as educational content around the topic blockchain, rounds off the offer.  All CVJ articles are translated from German and edited by MachinaTrader. Web: www.cvj.ch

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