Russia Pauses Efforts to Criminalize Bitcoin

So, on July 19, 2020, Ria Novosti shared that the Russian government has decided to hold off on plans to make Bitcoin illegal in the country. Anatoly Aksakov, who leads the financial markets committee in parliament, mentioned that the idea of putting fines and jail time on BTC investors is off the table for now, saying that "there will be no liability in this bill." Still, lawmakers might come up with a new law that could bring back these or other penalties this fall. Meanwhile, the updated DFA bill is aiming to sort out how digital financial assets are defined and set rules for blockchain operations. As it stands, all crypto and mining activities are still in a gray area. The Russian Ministry of Economic Development has told Parliament they’re not backing the draft law that would ban cryptocurrency, making their stance pretty clear.

Well, it’s already good that Russia has so far decided to exclude provisions on the establishment of criminal and administrative liability for the use of cryptocurrency from the draft law under consideration. However, it does not appear from the above text that Russia has refused to punish for the use of cryptocurrency, and even more so that it will be legalized. Most likely, indeed, until they agreed on how to punish for this. The bill had to be passed and left for the summer holidays. Therefore, this is only a pause, not a final decision.

But as per article: So nothing has change here,  pretty obvious that Russia is anti-crypto, specially on how they flip their tune every time we read or hear news coming from their regarding crypto specially bitcoin. And this supposedly 'special law' will really be sever penalties and longer imprisonment.

This is the better route for now. Cryptocurrency laws and regulations are most probably welcome by the majority of crypto supporters but the problem lies in the earliest stage which is setting up clear-cut definitions and classifications. This stage is very vital in that it is where understanding or lack thereof happens. If Bitcoin or crypto is wrongly defined or classified or misunderstood right from the start then everything from there would all be wrong as well, and Bitcoin owners might even up in jail simply for owning them.

Still this is yet to be discussed. But they should explain the context of this special bill on what extent does the special law will be put on bitcoin dealing for example, fraud or money laundering should have penalty equivalence appropriated like in the real law. I cant say they are anti crypto, they just wanted to be concise before laying some ground penalties for the offenders. Its like prepare first before you act.

Yes, keyword is 'temporarily.' They still have some regulations brewing to penalize those who use bitcoin within the country. Not sure how will they achieve it, but knowing how 'well' they enforced similar regulations in the past, it's better to stay in the clear than to openly show the world that one is dealing with bitcoins in Russia. They have been pretty hard on bitcoin lately, though it seems like people are still willing to risk their freedom and deal with cryptos, as evidenced by the flourishing crypto scene in Russia amid these talks about bitcoin ban and harsher regulations.

The reason may that these lawmakers came to a conclusion that it is impossible for them to track the bitcoin investors and right now they do not have the technology to identify everyone who is transacting cryptocurrency and they think that the situation might change in the future so that they can carry on with the proposed bill, either way many countries are trying to regulate the market and rather than banning regulating is the best option.

They will try to cover everything here, at the end, it will not be favorable for our Russian crypto enthusiast that's for sure. I don't know how long have you been in cryptosphere, but I've been following Russia's stance, and with such authoritarian government they will go full anti crypto in my opinion.

Im saying this, cause even the case is like that. There are many blockchain projects still came from Russia, like the founder of ethereum, I do know that their pusheover on crypto is very harsh and with that said, maybe they will have a change of heart just like what happened on China were banning on crypto dissolve into adoption of it.

Any political system based on communism (China) or dictatorship (Russia), and similar autocratic systems will always be against any system that is not fully or at least largely centralized and can be controlled. If we understand that the Internet is not something that can be used in these countries without censorship, then something like Bitcoin is completely unacceptable, because we know that money is an instrument that controls every individual and entire society. After all, it will be as the big boss says, it will not be decided by any ministers or members of parliament.

I also believed Russia has always been against crypto. Not to mention their state Duma hates cryptocurrency. I guess they have this extreme dislikes with the non government issued currency. It was quite a long time already since the crypto related transactions are in the gray zone in terms of it's legalities and regulations. according to this article when they have completed a crypto bill on April, but delayed its implementation because of the pandemic. I think they're still looking to regulate and want to take control of the crypto assets, as they have seen a very reasonable value in this asset.

classic russia---"nope, we're not gonna ban bitcoin, but we might ban it in a few months!" when crypto legislation is finally passed, i think it'll be relatively tame, like it was in china in 2017 after years of prohibition threats from the PBOC. they'll probably just codify the existing implicit ban on exchanges. maybe they'll whitelist some, or start regulating miners. there is lots of opposition in the government from multiple ministries towards criminalization, and frankly putin doesn't seem too concerned either way.

Even their official news is not showing any kind of final decision on what the Russian government wants to do with their crypto industry. This is just evidence that they actually don't know where they really want to head with their regulations on crypto or if they really want crypto in their country. So you can't really make this as an official news since they are still not sure if they want to have a crypto industry. They are just like India in a sense that they see the bad side of crypto from the anonymity standpoint and they don't want to take care of any AML standards or KYC procedures just to simply solve their problem.

classic press .. The Russian press must be read correctly .. old Russian anecdote: now I will try to translate it: Now in Russia, every 5 people work unofficially according to Rosstat https://www.rbc.ru/economics/05/09/2019/5d6e74fb9a794709eeba4f8c In practice, the situation is even worse, and as a result of the pandemic, many people have lost their jobs. The government is trying to "bring people out of the shadows" by offering citizens preferential tax regimes (4% tax on income in the next 10 years + a moratorium on changing legislation) Therefore, cryptocurrencies are unlikely to be criminalized.

That's an excellent point, and it probably applies to a bundle of other countries, not just Russia. Tax revenues are taking a nosedive everywhere, all across the world. Offering preferential tax schemes is one way to soften the blow, if it can rein in tax avoidance and the informal economy to any degree. As an example, South Korea just revised the tax code, subjecting cryptocurrency gains to a 20% tax. In comparison, the tax rate on gains made on the transfer of stocks is 22%. One has to wonder if this preferential treatment is a tacit admission that the government has difficulty enforcing the tax code against cryptocurrency traders. It looks like an indication that they are hopeful to "bring cryptocurrency traders out of the shadows" like you mentioned.

The problem isn't just cryptocurrency. In Russia, it is not customary to complain to the tax authorities about citizens. For example, my friend was engaged in the repair of household appliances for regular customers and did not pay any taxes. When he moved to Italy, he started this business in Italy without registration. A few months later, he was summoned to the tax office, issued a warning, given recommendations on registration, and warned that for the second time they would open a criminal case and deport him from the country. Investment in cryptocurrencies in Russia is not very popular yet, mining is popular only in some cities because of cheap electricity( for example, in Irkutsk 1 kilowatt costs 0.015 dollars, and in Moscow at least 3 times more expensive). Searching for all cryptocurrency users in a large country is very expensive for the country's budget, it is probably easier to offer them a favorable tax regime.

I am sure that cryptocurrency in Russia sooner or later will be banned or limited in use. At the moment, even if the use of cryptocurrency were prohibited, it will be difficult to track users, so it makes no sense to introduce this law now.

How can you be sure of that? are you from Russia and you are aware of the talks and updates that's happening there for bitcoin? The news about criminalizing or banning bitcoin in some countries has always been a rumor. For example in China, it's been said that ICOs were the ones that has been banned on their country and bitcoin too. But look, they have the biggest share of hashrate for bitcoin. As long as there's no verified and official statement from the Russian government, take all of it as a rumor.

If the top world economy can allow cryptocurrency I expect regular review also from Russia until it is favorable to the country's financial system  ATM cryptocurrency cant be used to purchase any good and services within the country except crypto to crypto or crypto to fiat; which I think is used to control criminal transactions and to monitor exchanges. The central bank of the country allows the exchange to Fiat before other fiat transaction can take place, this is not the last review of the bill, so we might see better ones as time passes.

What will people gets for posting fake news or speculating events, people when posting here should post official statement or official source we need facts here people are making a huge mistakes believing these fake news and in the end making a wrong decision about their investment and trade, we should always go for facts.