Putin Presented with a Roadmap for Blockchain Regulation

News and Analysis

Russian Internet Development Institute (IDI) offered the president Vladimir Putin a roadmap regulating implementation of blockchain technology. Moreover, the roadmap includes proposals as to crowd-funding and crowd-investment, facilitate taxation of freelancers, and withdraw limitations on anonymous payments for tax and loan purposes.

The institute’s offering is titled “Economy and Finance”. It is an appendix road map for a broader “Program for Long-Term Development of the Internet”. As opposed to the initial version, the overall list of proposal now incorporates development of regulatory framework for bitcoin’s underlying technology, blockchain.

According to the roadmap, Blockchain is subject to legalizing by January 2017. IDI elaborates:

“Blockchain is not the same thing as Bitcoin. It is a disruptive technology of distrubuted databases, which banks and organizations working with securities will find useful.”

However, examples of blockchain-based systems not related to cryptocurrency are scarce. For that reason, some experts express their doubt in reasonability of the offering.

“Blockchain is an interesting technology that could benefit the banking system. However, all players will have to act together, which is unlikely in the short run. Cryptocurrencies could incentivize them, but as for now the legislators hold even more against them, than against cryptotechnologies in general,” a representative of payment processor Yandex.Money commented to CNews.

Other initiatives from the institute include proposed amendments to the laws “On the National Payment System”, and local AML and counter-terrorist regulations. According to the proposal, operators of various e-currency systems will not be required to demand customer identification for transactions related to taxation or loan repayments. IDI’s representative told: “We want to expand opportunities for anonymous payments, as they are futile for corruption”. According to the proposal, such amendments shall become effective as of mid-2016.

Apart from that, the roadmap seeks to make things easier for internet freelancers. The proposal introduces mechanisms of simplified identification of and taxation for private contractors working remotely, whose legal status is in fact beyond any checking. Those mechanisms are to be developed by September 2016.

Finally, the roadmap incorporates proposals as to permitting individuals to join online crowd-investment campagins, which is available now only for commercial entities. On top of that, the proposal seeks regulatory framework for innovative funding methods of remote retailing entities, i.e. crowd-funding.

The institute proposed its roadmap almost simultaneously with the draft Administrative Violations Code submitted to the Russian Parliament, the State Duma. The draft bill de-facto exempted bitcoin from being prohibited as a money surrogate, and launched a new string of positive expectations in the local cryptocurrency community. Currently, the draft bill has already passed in the first reading.

As for now, Russian officials did not comment on the proposal.

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