The Russian Ministry of Finance has reportedly proposed to ban cryptocurrency in the country, but wants to make exceptions for stablecoin issuers and cryptocurrency miners.
By frank mediaSources “familiar with the matter” told the Interfax news agency that the proposals could be included in the much-delayed crypto mining legalization bill, and have already been drafted.
The ministry wants to go ahead with legislation that would officially allow industrial miners to operate in the country.
Russia’s crypto mining sector is already well advanced, mainly due to the nation’s rich energy resources and cold winter weather.
But currently mining is not recognized as a legal form of business, nor can it be taxed accordingly.
The ministry wants to rectify this.
And he hopes that the mining law will soon be approved by the State Duma.
But it has been stymied by the crypto-skeptic Central Bank.
The bank wants to ban “private” crypto assets like Bitcoin (BTC).
In recent months, the bank has suggested that it is willing to compromise on some aspects of its stance.
And he has reluctantly given the green light to commercial firms using crypto to evade sanctions.
So far, Russian lawmakers have only passed crypto-specific legislation.
This 2020 law prohibits the use of cryptocurrency as a form of payment and prohibits companies from advertising cryptocurrency-related services.
All other bills, proposals and the like have failed to satisfy both the pro-industry ministry and the always skeptical Central Bank.
But perhaps in an attempt to end the stalemate of years, the ministry has now suggested “banning the organization from the movement of [cryptoassets]with the exception of [crypto] mining.”
The proposals would effectively ban Russian crypto exchanges and crypto ATMs.
But, perhaps unsurprisingly, the proposals are already facing challenges in Moscow.
Two “law enforcement agencies” have said they “oppose the amendments.”
The agencies reportedly believe that the introduction of “a ban on organizing the circulation of the digital currency as a whole” requires “further discussion.”
The Federal Security Service (FSB) reportedly said that the definition of “the organization of the movement of [cryptoassets]” needed a clearer definition.
And the Investigative Committee, the country’s top federal investigative authority, also said the “wording proposed by the Ministry of Finance” could “cause confusion.”
Police and other officials might also be concerned that a ban would be difficult to enforce when, according to government figures, around 12% of Russians own crypto assets.
If these objections derail the ministry’s crypto plans, it would not be the first time that law enforcement agencies have seemingly thrown an insurmountable hurdle.
The Central Bank has previously stated that miners’ tokens should only be sold on foreign crypto exchanges.
But law enforcement agencies objected, warning that this could lead to an increase in money laundering.