The head of State Duma Financial Market Committee for the Russian government, Anatoly Aksakov, has confirmed that drafts of legislation are being prepared to regulate cryptocurrency activity in Russia. Cryptocurrency will remain legal in Russia, but will be renamed ‘Digital Rights’. The legislation could be passed and adopted by the Russian Duma on 29 July 2018.
All references to cryptocurrency, digital money, and digital currency will disappear from Russian lawbooks, and be replaced with the new term. Cryptocurrencies are going to be considered rights instead of assets. Therefore, cryptocurrencies won’t be considered typical property, but instead as a new category of property.
Russian tax laws will have to be modified to take into account that cryptocurrencies are no longer an asset. It is likely that cryptocurrency tax laws in Russia will be entirely rewritten.
Additionally, Aksakov says initial coin offerings (ICOs) will be legal but regulated. ICO tokens will be considered securities and regulated as such. Further, the Central Bank of Russia will determine if ICO tokens can be used as a payment method or if they are too risky on a case by case basis.
The Russian legislation on cryptocurrencies is being developed and implemented to reduce risk associated with the previously unregulated nature of cryptocurrencies, which has resulted in fraud. These changes being discussed by Aksakov are not official yet and still will have to go through debate and voting in the Duma.
Russian Prime Minister Dmitry Medvedev has said that regulating everything in the digital world is counterproductive, instead regulations need to be flexible and not inhibit cryptocurrency development. The primary goals of regulation would be to start obtaining taxes from cryptocurrency activity and to prevent crime. He says any ban on cryptocurrency would be unrealistic and unenforceable.
It is positive news for the cryptocurrency world that Russia will be writing a legal code for cryptocurrency and allowing its use, rather than banning it like neighboring China did.
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