The Bank of Russia is pushing for the introduction of liability for the illegal use of digital assets.
The Bank of Russia, Moscow’s monetary authority, wants anyone who utilize cryptocurrencies illegally to face consequences. The banking regulator has recommended introducing legal responsibility for some illicit actions involving digital assets.
Cryptocurrencies and associated activities in the Russian Federation are only minimally regulated, primarily through the statute “On Digital Financial Assets,” which come into effect at the beginning of this year. One of the unanswered questions is whether digital money can be used to pay for products and services.
The Central Bank of Russia (CBR) has persistently resisted authorizing payments in bitcoin and other cryptocurrencies. The authority maintains that all of them are “money surrogates” that are prohibited under existing Russian legislation, which recognizes the ruble as the only legal tender in the country’s 11 time zones.
The CBR now seeks to impose legal consequences for what it considers to be “illegal circulation of digital financial assets.” Surprisingly, the drive is part of the bank’s goals for “creation of an enabling environment for the introduction of new technologies and support for innovation in the financial market,” which are two of the bank’s primary “strategic directions” under the banner of “promoting digitalization.”
The suggestion has been included in the Bank of Russia’s program paper titled “Main Directions for Financial Market Development in the Russian Federation until 2024.” The project’s Board of Directors has accepted its submission to the State Duma, the lowest body of the Federal Assembly.
According to the CBR, a series of federal legislation aimed at complete legal control of digital financial assets and utilitarian digital rights must be established in order to build novel financial instruments. According to the central bank, another issue that has to be addressed is the taxation of transactions involving these rights and assets, for which a mechanism should be developed.
The Bank of Russia also mentions that attempts are being made to establish a digital version of the national money. The introduction of the ruble’s third form, after cash and bank money, necessitates a slew of legal reforms, according to the monetary authorities. Anatoly Aksakov, the head of the legislative Financial Market Committee, stated earlier in November that the Duma is preparing to alter 13 Russian laws and rules to accommodate the CBDC.
Meanwhile, members of the house have expressed worry that the digital ruble may endanger the financial sector and information security. Simultaneously, Bank of Russia Chair Elvira Nabiullina recently noted that the new currency is exactly what Russians need since it would give an alternative to cryptocurrencies and stablecoins while enabling inexpensive and reliable payments.