New Crypto Money Move from Russian President Putin
Russian President Vladimir Putin signed a new law in 2021 that will ban the use of cryptocurrency as a means of payment in the country. Meanwhile, the Russian government recently used blockchain technology for constitutional amendments.
Payment as crypto will be illegal in 2021
The bill, signed by President Putin, will prevent citizens from using crypto to pay for goods and services in Russia, the local news agency RIA reported on Friday (July 31st, 2020). The bill will enable transactions through digital financial assets (DFA).Speaking on the new draft bill, Anatoly Aksakov, head of the Financial Markets State Duma Committee, said the Russian government has defined crypto as a means of saving, payment and investment. This law effectively retains the priority of the Ruble as the only legal currency in Russia.
Although the new law has been approved by the government, some of the article states:
“Russian individuals and legal entities will be able to appeal against transactions with digital currency in court only if they declare that they have cryptocurrencies in Russia.”As reported in May, Russian lawmakers proposed a bill that would make the issuance and trade of the cryptocurrency illegal. The proposal also tried to sentence the criminals to two million rubles and imprisonment. Shortly thereafter, the State Duma reportedly attempted to lift the proposed bill.
Central Bank of Russia Supervises Digital Asset Transactions
While the new bill will see the ban on using crypto as a means of payment, it allows companies to publish DFAs after receiving approval from the Bank of Russia. Russian commercial banks and other companies can also operate DFAs under the protection of the country’s central bank.These tokenized securities can be exchanged for other assets with all these transactions monitored and approved by the central bank. The Bank of Russia will develop methods to evaluate these DFAs to determine whether they are eligible for investment. However, just like cryptocurrencies, DFAs will not function as a means of payment.
It should be noted that although the Russian government does not seem to embrace the cryptocurrency, its attitude towards blockchain technology is different. The government used the blockchain to change the constitution, which will decide whether or not Putin will continue for the third time.