After years of doubtfulness near its cryptocurrency regulation, Russia is further confusing its proposed crypto police every bit the country'south central depository financial institution fabricated nevertheless some other argument on the issue.

According to a legal executive at the Bank of Russia, the country's major merely still unfinalized cryptocurrency legislation — a bill "On Digital Financial Assets" — will ban the issuance and apportionment of cryptocurrencies.

Alexey Guznov, caput of the legal section at Russia'due south primal bank, revealed the news in an interview with local news bureau Interfax on March 16.

Issuance and apportionment of crypto in the country poses an "unjustified risk"

Although the original bill "On Digital Fiscal Assets" stipulated that cryptocurrency trading would be allowed in Russia, the amended document will evidently prohibit nearly everything about crypto except property, according to Guznov's latest remarks.

The official said that the upcoming law volition explicitly prohibit the issuance and circulation of cryptocurrency and would introduce penalties for violating this constabulary. Guznov argued:

"In terms of the functioning of the financial arrangement and consumer protection arrangement, legalization of the issuance and facilitating the circulation of cryptocurrencies is an unjustified take chances. As such, the bill explicitly prohibits emission and organization of cryptocurrency circulation, introducing legal liability for violating these rules."

Russian federation's central bank would unlikely exist able to regulate Bitcoin transactions

Besides claiming that the crypto bill would ban Russian fiscal institutions from issuing digital assets, Guznov provided little clarity nearly the upcoming beak. When asked whether the Bank of Russian federation wants to ban residents from converting crypto into local fiat currency, the Russian ruble, or a strange currency, Guznov did not provide a direct answer.

Instead, the exec reiterated his stance that the cardinal bank opposes institutions issuing cryptocurrencies, adding that the bank would be unable to impose sure limits on transactions in Bitcoin (BTC):

"If a person who owns, for example, Bitcoins, completes a transaction in a jurisdiction that does not prohibit this, we are unlikely to be able to regulate that."

Russia's crypto law was get-go introduced in January 2022

The latest remarks about Russian federation's upcoming cryptocurrency regulation come after years of uncertainty as well equally multiple delays in providing whatever regulatory clarity. Outset introduced in January 2022, President Vladimir Putin has ordered the adoption of the bill "On Digital Financial Assets" twice, but the legislation is still unfinalized to engagement.

While Russia'due south Ministry of Finance has been trying to legalize cryptocurrencies in the country, the central bank has apparently been fighting to ban Russians from legally using crypto at all.

In February 2022, the Bank of Russia issued a whole set of rules for suspicious transactions, categorizing any crypto-related transaction as a potential money laundering take a chance.

While prohibiting local entities from issuing their own digital assets, the central bank has been considering the emission of its ain digital currency. In Dec 2022, the bank's head Elvira Nabiullina said that the institution was exploring the possibility of issuing a digital ruble.