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Russian Ministry of Finance proposes to regulate cryptocurrencies

The Russian Ministry of Finance submitted to the national government a legislative proposal to regulate cryptocurrencies in the country.

The draft federal law “On Digital Currency” is “aimed at creating a legal market of digital currencies and establishing rules for their circulation and the circle of participants,” the institution reported in an entry on its website.

The legislative proposal also establishes requirements for digital asset exchange platforms and operators in general.

These requirements, which will relate to governance, cover reporting, information storage, internal control and auditing, as well as the risk management system and the amount of own funds.

For this purpose, a special registry of operators will be created and a regulatory body, to be determined by the government, will be in charge of authorizing companies that can carry out such activities. Foreign cryptocurrency platforms will be required to register in Russia in order to obtain a license.

The draft law will also require customers to identify themselves in advance in order to carry out transactions for the purchase and sale of digital currencies.

Deposits and withdrawals of cryptocurrency from the customer to the trader and vice versa will only be possible through banks using a bank account, the proposal says.

For their part, exchanges and banks will have to report any suspicious transactions directly to Rosfinmonitoring, Russia’s Federal Service for Financial Supervision.

In order to protect investors, exchange platforms will be obliged to report on the “high risks associated with the acquisition of digital currencies”.

Customers will also be required to undergo a test before trading cryptocurrencies. Their level on that test will determine the amount they can invest in crypto.

“If they pass the test, citizens can invest in digital currencies up to 600,000 rubles annually [about USD $7,800]. If they fail the test, the investment limit will be capped at 50,000 rubles [USD $600]. Investors and qualified legal entities will be able to conduct transactions without restrictions,” the official document states.

The regulations include other regulations, including requirements for platforms to separate their digital assets from those of clients.

Ministry of Finance will consider Central Bank proposal

The Ministry of Finance indicated that it will consider the Russian Central Bank’s cryptocurrency ban proposal, also the application of sanctions, as long as they do not contradict its own regulatory approach.

The official statement reads:

The proposals received by the Bank of Russia will be taken into account in further work on the draft law to the extent that they do not contradict the approaches of the Russian Ministry of Finance.

The legislative proposal also mentions cryptocurrency mining. According to the document, a legal definition will be created for Bitcoin and cryptocurrency mining, as well as the legal obligation to “inform the tax authorities” about their activities.

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