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What’s in the bill that the Russian Finance Ministry has been calling for crypto?

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In the list of authorities across the countries criticizing the crypto usage, Russian authorities were among the leading ones but now seem to  change their stance

The new bill is anticipated to have proposals that would act as a remedy for previous drafts regarding the crypto ban from using it as a method of payment. The bill ‘On Digital Currencies’ would rather focus on exploiting the advantages of seeking crypto as an investment vehicle that could help restore the economy. Proposals listed in the bill were made by the Ministry of Internal Affairs, the Ministry of Economic Development, the Ministry of Digital Development, the Center for National Projects of  Analytical Center and the Federal Tax Service. 

While talking about its practical usage, a representative of the Russian Central Bank outlined that using cryptocurrencies for foreign trade is quite possible theoretically but such applications of crypto assets are limited in their scope. He said so considering the fact that the contribution of crypto payments is far less than payments via traditional payment systems and also there is a threat of being detected by the international regulators while making large transactions and they could stop them. 

ALSO READ – Long Term Holders Strengthening Ethereum As Per A Research Organization

It was February of this year itself when the Central Bank of Russia proposed to put a ban on cryptocurrencies and all the related operations including their mining, using for transactions, investing in cryptocurrencies, storing them as assets etc, just like China did last year. On top of that the proposal also mentioned imposing a hefty fine of about one billion rubles on those who were found violating the law and uses crypto even after putting the ban. 

Prominent cryptocurrency exchanges like Binance have put their operations on halt in the country after the Russian military invasion of Ukraine. During its action, Binance has put a ban on Russian Citizens for depositing and trading cryptocurrencies with assets worth more than $10,000. Currently has reserve holdings of about $630 billion and about half of which is reserved abroad in foreign central and commercial banks. 

Undoubtedly, the punitive sanctions that western and European countries have put against Russia following the war with Ukraine, has made the country go through several losses and a degrading economic situation within the country. To evade the sanctions and ban on trade with Russia, cryptocurrencies were being looked at as a potential medium.

However the officials of Russian authorities have always been seen denying this. Even when the recently proposed bill was also doubted as an effort towards the same, the denial followed by. The Center for  Strategic Research’s head of Legal Development Direction, Maxim Baskatove said that the proposal of using cryptocurrencies as yet another foregin transactions settlement vehicle has been considered for a while now. He said this should not be looked at as Russia’s attempt to avoid the sanctions.

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