Duma Approves Bill Placing a Ban on the Use of Digital Assets in Russia

Russian President Vladimir Putin has signed a bill addressing the ban on the use of digital financial assets (DFA) for payments. 

The bill which was passed to the Russian Assembly also known as the State Duma was approved on July 8. It is also an amendment to the previous bill passed in 2020 which banned cryptocurrencies from being used in payments. 

The new bill had already been considered by the Federation Council and the Upper Chamber of Parliament. Both chambers are meant to approve any bill before it can finally be signed by the President of Russia.

Two years ago, a digital assets law was drafted to ban the use of cryptocurrency for payment in Russia. The bill regards any form of digital asset payment as illegal and punishable. 

The authorities were also mindful of the financial instability that the use of crypto would cause. Meanwhile, in February 2022, the Russian government announced its schemes to regularize cryptocurrency in the country. The scheme was to put strict rules to safeguard investors against the risk of crypto investments.

The Ministry of Finance, Rosfinmonitoring, the Bank of Russia, the Ministry of Internal Affairs, the Federal Security Service, the Federal Tax Service, the Ministry of Economic Development, and the Prosecutor General’s Office all partook in the debate that birthed the plans to regulate digital assets trade. Although the Central Bank of Russia (CBR) was still pushing for the government to ban the digital asset. 

Russia is Now Under Global Scrutiny

For a while, the country has been under the eyes of authorities due to certain crypto crimes connected to Russia. 

International organizations including the European Union issued a ban on Russia and this caused many others to stay away from the estranged country. Binance, the world’s largest cryptocurrency exchange pulled most of its services from Russians. Mastercard, a leading financial service provider disconnected its payment system from Russia as a penalty for remaining resolute in its invasion of Ukraine.

Even though Russia seems not open-handed about crypto as the signed bill connotes, it is suspected that the country is making use of crypto to evade sanctions.