A bill drafted by the Russian finance ministry proposed limits on annual cryptocurrency investments. The Russian Ministry of Finance has drafted a law that proposes certain limits on cryptocurrency investments based on financial literacy tests. Other recommendations from the ministry include taxation of crypto mining, legalization of crypto as an investment vehicle, and full KYC for crypto transaction.
Cryptocurrency bill from Russia
The Ministry of Finance of Russia has reportedly submitted a draft law on cryptocurrency regulation in the country. The draft legislation seeks to better protect digital asset investors through various means, including imposing a cap on annual crypto investments. Historically, the country’s Ministry of Finance has been in favor of crypto legalization and regulation rather than an absolute ban, which is what the Central Bank of Russia has previously advocated. The latest bill now wants cryptocurrencies to be recognized as an investment vehicle, but banned as a payment method. Additionally, if the legislation is approved, it will bring more security requirements to crypto investors. Anyone wishing to make a crypto transaction must provide their full client ID. Russian Finance Minister Anton Siluanov proposed a similar move earlier this month, saying banks should be able to offer crypto services.
Moreover, lawmakers are seeking licenses issued to foreign crypto exchanges as permission to operate on Russian soil. These trading platforms will also need to provide financial literacy tests to their Russian customers. Second, it will become the criteria determining how much individuals are allowed to invest in cryptocurrencies. Those who pass the test will be able to allocate up to 600,000 rubles ($7,806) annually to their digital currency investments. On the other hand, a limit of 50,000 rubles ($650) will be applied to those who fail. The ministry shows its support for crypto mining in Russia but says the effort should be taxed. The country’s President, Vladimir Putin, had previously agreed to crypto mining in the country, saying that Russia has a “competitive advantage” due to cheap electricity prices.
Earlier this month, the government and the Bank of Russia jointly released a bill that now contradicts that of the Ministry of Finance. The first wants to equate cryptocurrencies with the country’s ruble rather than classify them as financial assets. Second, just like the country’s Minister of Finance, he wants crypto investments to be treated similarly to investing in precious metals.