Russia may ban the payment of goods and services with cryptocurrencies, but implementing the ban can be quite difficult. This is the conclusion of Anatoly Aksakov, the chairman of the Russian State Duma (aka Parliament) Financial Market Committee.
According to Russian media reports yesterday, the Russian central bank may support a ban on crypto asset payments.
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The Russian central bank reaffirmed the ruble as the country's only fiat currency and reintroduced clichés about money laundering and terrorist financing:
"We still believe there are significant risks in cryptocurrencies, including in the areas of criminal money laundering and terrorist financing, and in foreign exchange transactions due to large fluctuations in exchange rates."
The Russian central bank is continuing to make negative comments on the topic, adding that it will support any action taken by regulators, as confirmed by Alexey Yakovlev, deputy minister of banking supervision of the Russian Ministry of Finance, prohibiting the use of cryptocurrencies as a payment method.
In Russia, crypto assets are currently available for payment at some retail outlets and are one of the ways for freelancers to receive wages.
But Aksakov believes that such bans are difficult to enforce, and said in an interview that from a practical perspective, it is difficult to take enforcement action on cryptocurrency payments.
"In the draft Digital Financial Assets Act, these instruments (cryptocurrencies) are prohibited. Therefore, this provision is being added to other bills simultaneously, and cryptocurrency transactions that are expected to take place on the territory of the Russian Federation need to be held accountable. Although negotiations have been going on for quite some time, law enforcement is still questioning. Perhaps this is one of the reasons these bills have not yet been agreed on. "
The official emphasized that although it was not easy to impose such a ban in Russia, it would at least prevent more cautious citizens. At the same time, all people using cryptocurrencies will continue to use it despite the ban.
Beyond that, Aksakov said the implementation of this ban is hampered by the lack of a clear legal definition of cryptocurrencies. He said:
"Russia prohibits the use of currency substitutes. So far, there is no clear definition of cryptocurrencies as a substitute for currency. The ruble is the only means of payment, but other fiat currencies are also used. Therefore, all these issues require a legal definition in order to Law enforcement agencies work more conveniently. Is it a currency substitute? Or is it a digital currency? "
The Russian central bank has repeatedly stated its opposition to the legalization of cryptocurrencies, citing the risk of money laundering and other issues. The high volatility of the cryptocurrency market is another reason why it is not welcomed by regulators. As for whether the operation of cryptocurrencies is completely banned, the Russian government is still considering the pros and cons.
The State Duma has already passed a draft of the Digital Financial Assets Law in the preliminary review. Although the draft introduced definitions of cryptocurrencies, tokens, and smart contracts, Russian experts did not agree on the definition proposed by the draft.