Russia to employ crypto for investments and not payments

Sahana Kiran
Russia
Source – Pixabay

Russia has been creating quite an uproar in the crypto market. A nation as big as Russia legalizing crypto would be a massive boost for both the crypto-verse as well as the industry.

As per a recent draft formulated and presented by the Russian Ministry of Finance, cryptocurrencies were still on the way to becoming legal, but not just yet. Amid a rift between Russia’s government and the central bank, it was revealed that cryptocurrencies were still not a legal payment option. The ministry intends to leave crypto as a medium of investment rather than a source of payment.

This wasn’t all. Legalizing a whole slew of currencies required immense regulations surrounding it. As a result, the proposed draft entails an array of rules governing the crypto market. The bill put forth by the Russian ministry is yet to be approved.

If approved, Crypto in Russa will look like this

Following the approval of the bill, Russians trading crypto would be mandated to undergo identification and proper verification. Foreign crypto exchanges would be allowed to function only with a license in the country.

Trading restrictions were also included in the draft, which has yet to be authorized. The exchanges in Russia planned to conduct financial literacy tests to decide how much citizens can invest. Those who pass the exam will be entitled to use up to 600,000 roubles in crypto each year. Those who do not make it through, on the other hand, will be subject to a yearly maximum of 50,000 roubles.

The Bitcoin mining industry is a contentious subject. While few governments were rejecting it, a few others were openly welcoming it. Russia was a part of the latter. The Ministry was all in on crypto mining. However, the bill said that taxing the industry was obligatory.

Government vs Central Bank

While the government has been pushing for the legalization of crypto, the central bank was still skeptical. Despite multiple discussions and meetings, both parties failed to reach common ground concerning crypto.

Although the latest bill would extensively regulate crypto, this division between two of the most crucial entities in a country spurred a lot of uncertainty.