Bank of Russia proposes Legal Liability on illicit operations with Crypto

Russia’s financial regulators are sticking by their long-standing anti-crypto stance, this time around by pushing the proposal to introduce liability for illegal use of crypto. Last week, in its document with the subject, “Main Directions for Financial Market Development of the Russian Federation”, the Russian Bank proposed manifold economic changes for the period until 2024, including the legal liability on crypto activities, which the financial institution considers to be illegal.

The Central Bank of Russia had already levied payments via virtual currencies as illegal under the current Russian legislation, which identifies ruble as the only legal tender in the country. In addition to its former decision, the Bank of Russia’s exclusive proposal to incorporate legal liability for the “illegal circulation of digital financial assets” in crypto regulations is unsurprising. Furthermore, the project has already been approved by the Central Bank’s Board of Directors for submission with the State Duma, the lower house of the Federal Assembly.

Russia Crypto Crackdown

Along with strengthening its crackdown on illegal crypto activities, Russian authorities have also been pushing for imposing taxation on all crypto businesses in the area, for a while now. A few weeks before the third quarter completed its course, the Chairman of Russia’s Duma Financial Market Committee, Anatoly Aksakov announced that the government plans to deem the pursuit of digital currency under the entrepreneurial activities category. The intent behind this was to impose the state’s taxation policies by registering all cryptocurrency processes as entrepreneurial activities.

“Since this is a type of entrepreneurial activity, obviously, it is necessary to enter it into the register, assign a code to it corresponding to it as a type of entrepreneurial activity and introduce taxation,”, Aksakov told the Russian publication, TASS.

The Bank of Russia has also looked down upon the US for its Bitcoin ETF, further confirming that Russia will take no such steps in near future. Last month, the CBR Chairperson, Elvira Nabiullina noted in a press conference that the country has no plans to follow the U.S. Securities and Exchange Commission (SEC) authorization of Bitcoin ETFs listing.