Even Russia’s Economy Ministry Doesn’t Want Crypto Ban, Derides Bill

Bitcoin Cryptocurrency Regulation Russia

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Tim Alper

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Tim Alper

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Tim Alper is a British journalist and features writer who has worked at Cryptonews.com since 2018. He has written for media outlets such as the BBC, the Guardian, and Chosun Ilbo. He has also worked...

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June 26, 2023

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Russia’s long and winding road to crypto regulation has taken another unexpected twist – with the country’s Economy Ministry wading into a bitter dispute between pro-business groups and the crypto-skeptic Central Bank – with experts claiming that a new impasse could see regulation “delayed by a year or more.”

As previously reported, after over two years of deliberation, a long-awaited draft version of the second reading of the “On Digital Assets” bill finally emerged at the end of last month – proposing a partial China-style crypto-crackdown that would, critics say, effectively end domestic cryptoasset trading in Russia and force crypto-related companies out of the nation.

But per media outlet Kommersant, the Ministry of Economy has “criticized” the bill being considered in the State Duma in a letter to parliamentarians, claiming instead that it “is possible to create mechanisms for the controlled circulation” of cryptoassets. Experts, says the news outlet, think that if the current bill were to be adopted, an “uncontrolled black market” for crypto would thrive in Russia.

The EXMO exchange’s head of development Maria Stankevich told Cryptonews.com that a “strict”-looking bill may have been issued as an attempt to “scare off” Moscow’s super-rich, who are “still bringing cases of cash to exchange to tether (USDT) or bitcoin (BTC)” – with “a lot of Russian oligarchs” active in the crypto market.

She added,

“What we think is going to happen is that the law will be postponed for a year or even more.

If not, the bill could end up doing more harm than good to powerful business interests, Stankevich opined.

Russian exchanges, and trading platforms headquartered elsewhere in the world but active in the country had petitioned the ministry in a joint statement, asking for politicians to consider the consequences of voting in favor of the bill.

Cryptonews.com has obtained a copy of this statement, which claims that in the wake of the coronavirus pandemic, it would be irrational to damage new growth engines. Its authors wrote,

“Unemployment is high in Russia, and incomes are down. It’s not rational to kill off a young and promising industry while it is still in its infancy.”

The Duma’s financial market committee chief, Anatoly Aksakov, is quoted by Kommersant as saying that he has not yet seen the letter from the ministry, but claimed,

“It’s good to be criticized. We’re not looking for approval, we need criticism.”

Aksakov stated that the bill was still in consultation, although the Central Bank agreed with it in principle.