20 May 2022 · 3 min read

Russian Crypto Regulation Can’t Be Delayed any Longer, Claims Top MP

Source: AdobeStock / Mistervlad

 

Russia’s parliament, the State Duma, will debate a crypto regulation bill that was formulated by the Ministry of Finance at the start of the year in the coming weeks, a senior MP has claimed.

Speaking to Lenta, Konstantin Bakharev, the First Deputy Chairman of the State Duma Committee on the Financial Markets, explained that the matter of crypto regulation could no longer be postponed – despite the fact that the Central Bank still opposes anything other than a total ban on crypto in Russia.

The committee’s Chair has previously stated that the bill would be tabled before the end of the spring session. And these sentiments were echoed by Bakharev, who was quoted as stating:

“The debate will be held in the near future. By that I mean, during the spring session. I have no doubt. We can no longer postpone it.”

If this is truly to be the case, the Duma will need to hurry. The current (spring) session ends on July 31, and MPs are still returning from a two-week break that began in early May. MPs will then be away from the chamber until August 29. If the bill were to pass two readings in the current session, debates would likely need to commence in the next two weeks.

But Bakharev indicated that the Central Bank and the government (which has the backing of most senior MPs on the matter) are still at loggerheads.

The bank has joined a cross-ministerial and joint-public-private sector working group on crypto regulation but still appears to be opposed to the bill – which seeks to “legalize” crypto ownership and trading. The bill also outlines tax procedures crypto traders would need to follow, seeks to regulate crypto exchanges, and – perhaps most importantly – seeks to regulate the crypto mining industry.

Despite recent data showing that bitcoin (BTC) mining has dropped in Russia, a number of major industrial players remain active in the sphere – with many urging the government to accelerate the legislative process.

The Central Bank, though, would rather see miners forced to close down their farms. Bakharev conceded that “the government and the Central Bank [still] have somewhat different approaches to the legal regulation of the cryptocurrency market.”

However, he insisted that talks within the working group would help the parties reach “legislative decisions regarding the legal regulation of the cryptocurrency market.”

He added that the forthcoming legislation “will take into account Russia-specific conditions,” but also incorporate “established world practice.”

Bakharev stated:

“Our task is to find solutions that will meet [everyone’s] interests. The main aim is to protect investors who invest in cryptocurrencies, and at the same time ensure this is a market that is regulated by the state.”

The minister of Industry and Trade Denis Manutrov earlier this week said that regulation in the sector was now “only a matter of time.” The minister stated that “both the Central Bank and the government” were “actively engaged” in talks over reaching a compromise, claiming: “Everyone is inclined to understand that […] sooner or later, in one way or another, [regulation] will be implemented.”

Meanwhile, RIA Novosti reported that the Ministry of Internal Affairs’ request to insert clauses into the bill that would allow courts and police to seize and freeze criminal suspects’ crypto holdings have been incorporated into the bill.

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