Russia is moving ahead with the final consideration of a bill on encrypted assets. According to Russian media reports, the State Duma will soon complete the final reading of the bill " Digital Currency and Digital Rights " and establish a formal legal framework for domestic encryption activities.

Cross-border settlement included in the bill

At the heart of the bill is the continued restriction on the internal encryption of payments while liberalizing part of the regulated business. In other words, Russia intends to allow for the operation of encrypted assets within compliance and to provide a legal basis for specific cross-border settlements, but does not use encrypted currency as a domestic daily means of payment.

According to disclosure, the bill would allow for cross-border encrypted settlement arrangements affected by sanctions. This means that, in foreign trade and money transactions, it may be possible in the future to use encrypted assets under clearer legal conditions.

September 1st or effective

Anatoly Aksakov, Chairman of the Russian State Duma Financial Market Commission, indicated that, if the bill was approved, the main provisions were expected to enter into force on 1 September. He added that enterprises supplying goods to Russia could use encrypted assets to complete the related settlement without undue restrictions.

Individual investment limit

  • Annual ceiling of 300,000 roubles for unqualified investors
  • Up to 100,000 roubles for off-shore transfers by unqualified investors
  • 3 million and 1 million roubles respectively for eligible investors

These arrangements show that Russia does not fully liberalize the encryption market, but prefers to move forward with transactions and settlements within control.

We'll continue to adjust our standards.

The Russian attitude towards encrypted assets has changed markedly over the past time. Previously, local regulation of assets such as TTcos and Taifung had been prudent and had not been seen as a formal currency. In the past year, Russia has begun to increase its activities in encryption, and some private banks have attempted to provide related services.

If the bill is finally adopted, Russia ' s encryption regulatory framework will be further clarified. For the market, two issues are of greater concern: whether cross-border settlements can create a real-use scenario and whether regulated transactions can lead to increased involvement of local institutions.