January 21, 2022

Prosecutor General’s Office Wishes to See ‘Cryptocurrency’ in Russian Legislation

The Prosecutor General’s Office in Russia wants the legislation in the country to be amended and have the term ‘cryptocurrency’ added to it. This would give power to the authorities in Moscow to confiscate any of these digital currencies that have been a part of criminal activities. As of now, digital currencies are only partially regulated in the Russian Federation and there is only one law that is currently applicable in this regard, which is known as ‘On Digital Financial Assets’. However, work is currently ongoing for adopting legislation that would introduce proper rules for bitcoin and other cryptocurrencies. It appears that the Russian Prosecutor General’s Office has now decided to join these efforts because they want legal texts to have the term ‘cryptocurrency’ added.

Igor Krasnov, the Prosecutor General of Russia, said in an interview that they had come up with several amendments to some regulatory legal acts. He said that doing so would enable them to recognize cryptocurrencies circulating illegally as a subject of crime and would also help in subsequent confiscation and arrest. Other legislative changes are also being contemplated by lawmakers in the Russian Federation in order to develop a proper legal framework for overseeing cryptocurrencies. There are a number of activities connected to these digital assets that are still outside the scope of the existing law.

This includes mining, taxation as well as payments. More and more officials in Moscow have been calling for giving the status of entrepreneurial activity to crypto mining and impose taxes on it accordingly. However, it appears that the Central Bank of Russia (CBR) is not in favor of the legalization of these digital currencies to be used as a medium of payment. According to the regulator, these cryptocurrencies are ‘money surrogates’, which are not permitted in Russia. Currently, the monetary authority is working on developing a digital ruble and has insisted that Russians need a central bank digital currency (CBDC).

Back in November, Elvira Nabiullina, the head of the CBR, said that this digital form of the national fiat currency would provide a reliable and low cost payment solution that would also keep personal data safe. According to the details, the trials for the CBDC would be launched by the Bank of Russia from January 2022. The Prosecutor General’s Office in Russia also proposed in the previous month to recognize cryptocurrencies as well as other digital assets as property in the Criminal Code of the country.

Speaking in the lower house of parliament called State Duma, Igor Krasnov said that they could the legal definitions for the purpose of court proceedings. Krasnov also disclosed that a bill had already been drafted by his department for regulating the matter and was hoping that it would receive the support of lawmakers. A number of other Russian acts have already recognized cryptocurrencies like bitcoin as a property, such as the laws on enforcement and bankruptcy proceedings, the anti-corruption law and also the legislation pertaining to anti-money laundering. Russia is not the only one that’s mulling over regulating cryptocurrencies, as it appears to be the theme in most places.

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