Russia Will Apply Restrictions on Cryptocurrencies, Exempts Miners and CBDCs
Russia imposes strict restrictions on cryptocurrencies starting September 1, but exempts miners. Its goal is to strengthen the ruble and control cryptocurrencies amid geopolitical tensions. The debate persists, as Russia’s Finance Minister advocates regulated use.
Starting September 1, Russia will apply strict restrictions on the general circulation of crypto assets such as Bitcoin. Only digital financial assets issued within its jurisdiction will be allowed.
Anatoly Aksakov, Chairman of the State Duma Committee on the Financial Market, heads this initiative. It is part of a broader government effort to control the cryptocurrency ecosystem amid rising geopolitical tensions.
Why Russia Wants to Restrict Cryptocurrencies
Aksakov stated that the upcoming legislation aims to restrict non-Russian crypto operations to reinforce the dominance of the ruble. Aksakov explained the following:
“Digital financial assets issued in Russian jurisdiction and digital rubles will be allowed. The need for restrictions is due to the fact that today cryptocurrency is a quasi-currency that replaces the ruble in the country. But only the Russian ruble fulfills the mission of the monetary unit, which is why this decision has been made. Restrictions will be introduced from September 1.”
The bill will establish exceptions for cryptocurrency miners and test projects sponsored by the Central Bank within an experimental legal framework. This is because cryptocurrency mining significantly increases Russia’s tax revenue.
Approximately, cryptocurrency miners produce over $2.59 billion in liquidity for foreign trade settlements. However, Anton Gorelkin, a member of the State Duma, clarified that Russia has no intention of banning crypto directly.
The restrictions will affect the creation of crypto exchanges and other platforms that will provide cryptocurrency exchange services. Gorelkin wrote: “Of course, the circulation of cryptocurrencies will not be banned. The creation of exchanges outside the zone of the experimental legal regime will fall under the ban.”
At the same time, there is intense internal debate among Russian policymakers about this approach. Artem Kiryanov, Deputy Chairman of the Economic Policy Committee of the State Duma, underlined the importance of precise regulation, in the following terms:
“The regulation of cryptocurrency should be prescribed in the digital code, which would clearly detail the conceptual apparatus and common judicial practice of law enforcement.”
More on Russia’s Restrictive Policies on Cryptocurrencies
In contrast to these restrictive views, Russian Finance Minister Anton Siluanov has advocated a more moderate stance. Earlier this year, Siluanov opposed an outright ban on cryptocurrencies, advocating for regulation that allows their use in both domestic and international transactions. Siluanov stated the following:
“I am sure that the Central Bank and we will reach an agreement. This issue has been debated for several years. We cannot prohibit the circulation of cryptocurrencies. Therefore, we have to regulate this channel. “I am sure we will find a solution.”
These debates point to a possible tilt toward using cryptocurrencies for external payments, reflecting a deeper understanding of their potential role in global finance. This approach is also supported by Elvira Nabiullina, Director of the Bank of Russia, who supports the experimental use of cryptocurrencies in international payments.
Meanwhile, recent reports indicate that Russian entities have used cryptocurrencies, particularly Tether’s USDT, to acquire critical components for military technology. One notable case involved Andrey Zverev, a Russian operative based in China.
In 2022, Zverev used USDT to bypass traditional banking channels and purchase drone components essential for military operations in Ukraine. This maneuver avoided the scrutiny typically associated with sanctions-wary financial institutions.
By Audy Castaneda