Russia’s Latest Bill Proposal Could Ban Crypto as a Payment Method

The head of the Russian parliament’s lower chamber (State Duma) – Anatoly Aksakov – presented legislation focused on cryptocurrencies and their employment inside Russia’s borders. If the bill gets approved, “digital financial actives” (DFA) won’t be accepted as a means of payment for any type of products or services inside the country.

Scrap Crypto, the Ruble is Russia’s Currency

The Russian authorities are strongly divided on how to approach the local cryptocurrency industry. The country’s central bank insists on a total ban of all digital asset endeavors, while the Finance Ministry believes imposing regulations is a better idea. 

At first, the lower house of the Federal Assembly of Russia – the State Duma – shared the central bank’s vision. In 2020, the lawmakers considered prohibiting the usage of digital assets and insisted that those who continue to interact with the sector be fined and even sent to jail.

In March this year, the authorities abandoned such plans, claiming that designing an appropriate regulatory framework is wiser than imposing a blanket ban on the asset class.

Earlier this week, the head of State Duma – Anatoly Aksakov – touched upon the topic once again, proposing a bill that outlines digital currencies as inapplicable for a payment method. He reminded that Russia’s national currency – the ruble – remains the only official monetary unit of the nation, and amendments are not necessary:

“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.”

According to an already existing legislation, employing DFAs as a payment method is illegal, but are not entirely prohibited. However, if approved by the Federal Council and President Vladimir Putin, the new bill will make the embargo official.

In addition, the proposal would require all financial, investment, and information platforms that interact with digital assets to be treated as “electronic” platforms. To legally operate, they should receive the central bank’s approval. The financial institution would also monitor their actions and put them into a special registry.

Russian Central Bank’s Take

A few weeks ago, a senior official at the Bank of Russia – Ksenia Yudaeva – said the organization is not entirely against the usage of the asset class, claiming it could facilitate international trade deals. However, the bank thinks broad society should not deal with cryptocurrencies as they pose risks to financial stability:

“We still believe that the active use of cryptocurrency within the country, especially within Russia’s financial infrastructure, creates great risks for citizens and users. We believe that in our country, those risks could be reasonably large.”