Russia May Legalize Cryptocurrency Exchanges

News and Analysis

The Russian parliament is preparing a bill that, if passed, may legalize e-cash and establish legal grounds to open regulated cryptocurrency exchanges, according to Elina Sidorenko, the head of the the Russian Central Bank’s working group on cryptocurrencies.

She noted that such government structures as the Central Bank, the Ministry of Finance, the Ministry of Economic Development, Russian Financial Monitoring Authority and law enforcement have no doubt as to the need to legalize cryptocurrencies in Russia.

“Presently, the Bank of Russia and involved departments are in the middle of formulating their joint position as to the status of cryptocurrencies. Afterwards, they will determine approaches towards their regulation and other issues,” the Central Bank’s press office stated.

Elina Sidorenko also noted that, though the nation state attempted to ban cryptocurrencies just a few years ago, now the officials are confident that this area needs development and are willing to render their assistance.

“We have to support those working with cryptocurrency, and make this activity easy. Still, we need to maintain data security at exchange platforms. It’s important that illegal revenues won’t be laundered, and assets won’t be moved offshore. We’re thinking of how to establish the conditions that could enable cryptocurrency exchanges actively develop in Russia,” she said.

Still, Sidorenko acknowledged that currently Russia is not very attractive in terms of creating a local cryptocurrency exchange.

“But we want to make it the way that they come to us,” she stressed.

She also added that the working group has prepared several bills, however, the members haven’t yet reached a consensus in terms of definitions. For instance, the group doesn’t have a uniform opinion regarding what a cryptocurrency actually is.

“We’d like to know what cryptocurrency is more like, a commodity, a payments tool, or a security. Or it’s something completely new. When we determine its nature, working with the legislation will be easier,” Sidorenko explained.

She also said that the nation state has to hear the opinion of the expert community. For that reason, Moscow will host a conference on cryptocurrencies on April 13th. The heads of Russia’s biggest companies will have an opportunity of sharing their vision of cryptocurrency and telling how they use it.

Meanwhile, Russia’s internet ombudsman Dmitri Marinichev noted that jurisdiction of an online platform depends on the legal entity’s place of incorporation.

“If a country’s legislation is ready to work with cryptocurrency, anyone will be able to launch an exchange. It will have to be registered with the Central Bank like a bank or a non-banking credit organization. Such exchanges will have their own reporting rules, and they will have some responsibility,” he said.

Just a day before, Russia’s Deputy Minister of Finance Alexey Moiseev stated that cryptocurrency operations may be legalized in Russia as early as in 2018.

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